Sky is now considering a possible merger or strategic partnership with O2 UK, it's claimed.
The Financial Times has reported that Sky has been holding discussions with the UK mobile network’s Spanish owner, Telefonica. It is likely trying to avoid becoming the only major UK broadband provider that doesn't offer a quad-play package of phone, broadband, TV, and mobile.
Sky might not want to acquire O2 after all, considering it just paid £200 million last year for O2’s fixed-line and broadband business. It more than likely prefers a mobile virtual network operator agreement with O2, in which Sky would resell O2 phone contracts as part of a quad-play package.
The Guardian said talks between Sky and Telefonica are at an early stage and will probably lead to a partnership rather than an acquisition. Keep in mind Sky's rival, BT, is currently negotiating a £12.5 billion acquisition of mobile operator EE that would give BT the ability to offer quad play.
In addition, Hong Kong-based Hutchison Whampoa, which owns Three, reportedly offered £9 billion to Telefonica for O2. Such a deal would combine O2 with Three as well as make the merged operator the biggest mobile network in the UK.