NTL Incorporated
|
|
| Type |
Public |
| Founded |
1992 As Telewest Communications |
| Location |
Corporate Headquarters: New York, New York, USA
Operational Headquarters: Hook, Hampshire, UK |
| Key people |
James Mooney,Non-Executive Chairman
Anthony Stenham, Executive Deputy Chairman
Simon Duffy, Executive Vice Chairman,
Stephen Burch, Chief Executive
Jacques Kerrest, Chief Financial Officer
Neil Berkett, Chief Operating Officer |
| Industry |
Cable Communications |
| Products |
Cable Television
Broadband
Telephone |
| Revenue |
$6.10 billion (2005) |
| Employees |
22.500 (2005) |
| Website |
www.ntl.com |
NTL NASDAQ: NTLI (the company will trade under NASDAQ: NTLID from March 6 until March 31) is a US listed company providing cable services. The company is the result of the merger of the United Kingom's two major cable companies, NTL Holdings Incorporated. and Telewest Global, Incorporated. The combined company is the dominant cable operator in the UK.
Company structure
The UK company, NTL Group Ltd is a subsidiary of NTL Incorporated. NTL has Three major operating divisions:
- NTL & Telewest Residential Consumer Sales And Services: Deals with offering Broadband, residential telephone and Residential Cable Services.
- NTL Telewest Business: Offers Business Communications including Broadband and telephone.
- NTL Content Division: Runs NTLs TV channels that are part of Flextech as well as its Television production businesses.
History
The current NTL was formed through a merger of two companies, NTL Holdings Incorporated and Telewest Global, Incorporated. Telewest was founded in 1992 as Telewest Communications which was a joint venture between TCI of the United States and also US West.
NTL was establised in 1993 (trading name: CableTel) by Barclay Knapp and George Blumenthal, the founders of the cellular network company Cellular Communications, Inc. (sold to Airtouch in 1996). CableTel was founded to take advantage of the deregulation of the UK cable business. Franchises were acquired covering the London area and parts of Scotland and Wales. In 1998 the business was renamed NTL.
The new name was an abbreviation of National Transcommunications Limited, the privatised UK Independent Broadcasting Authority transmission network which CableTel had acquired previously. The company spent heavily on both expanding its network and acquiring rivals. Its UK network is built of a 7,800 km fibre backbone and has the potential to reach 8.4 million residential homes and around 610,000 businesses. The company began to expand outside of the UK in 2000, buying into markets on continental Europe and also in Ireland.
The collapse of the telecommunications markets from mid-2000 was a serious blow to the company. This, combined with NTL's rapid acquisition of local cable operators, led to severe integration problems. NTL, struggling to cope with rapid expansion and suffering from significant customer service problems, then had to contend with the creation in November 2002 of one of the UK's first consumer lobby groups, nthellworld with ntl:hell following shortly after.
Devalued and struggling with debts of around $18bn NTL was forced to seek Chapter 11 bankruptcy protection in May 2002 in order to organise a refinancing deal. The company did not emerge from protection until January 2003, having converted around $11bn of debt into shares in what was, technically, the largest debt default in US corporate history. The company's debt was reduced to $6.4bn. NTL itself was reorganised into NTL Inc. covering the UK and Irish markets and NTL Europe Inc. for the French, Swiss and German parts of the business. The NTL president, CEO and co-founder Barclay Knapp, as well as Stephen Carter, the MD and COO, were replaced.
Present day
Since exiting from Chapter 11, NTL has produced an operating profit. In 2004 plans were announced to split the Broadcast division off from the main company. In December of 2004 NTL sold their Broadcast unit to a consortium led by Macquarie Communications Infrastructure Group (MCG) for £1.27 billion. The division was renamed Arqiva in May 2005. This sale will allow NTL to focus on their 'core businesses' of providing communications packages and cable services.
A merger between NTL & Telewest, the UK's other main cable operator, was announced in October 2005 and completed in March 2006. Thanks to their geographically different areas NTL & Telewest have co-operated in the past, such as directing potential customers who are outside their own areas to the other company.
The combined company is the dominant UK cable company with only a couple of independent cable operators remaining, such as WightCable (covering the Isle Of Wight, South West Scotland and North West England) & Kingston Communications (covering the Kingston-upon-Hull area). The merger is viewed as a positive move to help cable compete against the dominant Sky Digital platform in the premium television market, and against BT (and BT-provided ADSL services) in the voice telephone and broadband markets.
In autumn 2004, NTL purchased virgin.net.
Sale of NTL Ireland
Main article: NTL Ireland
Despite NTL Ireland turning a profit, in May 2005, NTL sold their Dublin, Galway, and Waterford cable business, which they acquired in 1999 for €680 million from the Irish government, to UGC Europe (since renamed Liberty Global Europe for €325(£222) million. This was after having spent in excess of €100 million on network infrastructure. MS Irish Cable Holdings, a subsidiary of Morgan Stanley, held the stake on UGC's behalf, until the deal receieved regulatory clearance. In December 2005 the regulatory clearance was received and NTL Ireland became a wholly owned subsidary of Liberty Global Europe. As of March 2006 the NTL brand continues to be used in Ireland by Liberty. It is expected that the brand will be eventually replaced by UPC however.
In January 2005, NTL started rolling out Video On Demand. The content is selected by NTL and covers most genres including music videos, children's programming and adult entertainment. This is an extension to the basic 'pay per view' services the company offered for Film and Sport content, and the new service allows customers to rewind, fast forward and pause content.
NTL's debt was cut to £1.445 billion by July 2005, with an operating cashflow of £178 million. The company had 3.2 million customers who take at least one service from them, with the 1.4 million subscribers to broadband services making NTL the market leader.
Virgin Mobile merger
In December 2005 it was announced that Virgin Mobile was in talks with NTL regarding a merger. The new company would be branded under the Virgin Group brand, likely to be Virgin Vision or Virgin TV. A merger of Virgin and NTL would create the UK's first 'quadruple play' media company, bringing together TV, internet broadband, mobile phone and fixed-line phone services.
Under the deal, Virgin owner Sir Richard Branson was understood to be planning to swap his controlling 72% stake in Virgin Mobile for a 14% holding in NTL, which would make the billionaire entrepreneur the biggest single shareholder in the combined group, and give him a share of future revenues.
The original bid of £817 million ($1.4 billion) was rejected by Virgin Mobile's independent directors, who took the view that NTL's bid "undervalued the business". Sir Richard Branson is reported to be confident that a re-structured deal can be completed.
The offer was increased in January 2006, to £961m, or 372p per share, which will be formally made after the completion of due diligence. This offer has been broadly supported by the Virgin Mobile Board and the minorities.
The offer will have three options: 372 pence per share in cash; 0.09298 new NTL Inc. shares for each Virgin Mobile share, worth 352p; or a combination of NTL shares, convertible stock and 67p in cash, worth in total 349p.
Branson has indicated that he will accept the third option. This will lead to him receiving a 12.5% stake in the newly enlarged NTL, and will help to fund the increased 372p per share in cash for the minority shareholders.
Broadband TV (Interactive)
Broadband TV is a new Interactive service that is currently being tested across the NTL Digital Network after one year in development. The service allows for NTL Digital TV customers to have access to Interactive services that equal or out-perform those available on SKY, as the service is run from Servers at the customer's local head-end, therefore bypassing the need for the customers STB to do any of the hard work.
NTL Broadband
NTL offers broadband connections through Cable and ADSL. Cable is the most predominately used service and this is provided through SACMs (Stand-alone cable modems) and STBs (Set-top boxes). Current speeds offered to Cable users are 1 Mbit/s, 2 Mbit/s and 10 Mbit/s with prices at £17.99, £24.99 and £34.99 respectively. The 1 Mbit/s and 2 Mbit/s services are currently uncapped. The 10 Mbit/s service has a 75 GB cap on uploads and downloads combined. People who break the cap (after warnings) will be downgraded to an unlimited 512 kbit/s package costing £17.99.
Customers were upgraded for no charge to these packages from the previous 300 kbit/s, 750 kbit/s and 1.5 Mbit/s tariffs in March 2005.
NTL has replaced the 3 Mbit/s service with a 10 Mbit/s down/512 kbit/s up service that has a 75 GB cap while lowering the price from £37.99 to £34.99. In 2006, NTL Broadband offers:
1 Mbit/s Unlimited - £17.99
2 Mbit/s Unlimited - £24.99
10 Mbit/s (75 GB cap) - £34.99
For customers who do not live in cabled areas NTL offer an ADSL Broadband service through BT landlines. This is known as "NTL Freedom (Broadband)", the word Freedom is used in NTL literature to distinguish the service from the Cable Broadband service which is simply dubbed "NTL Broadband". NTL Freedom users are supplied with an ADSL modem for their PC and they receive 1 Mbit/s downstream and 256 kbit/s upstream. The service has unlimited usage (no bandwidth caps). This is fixed for all users and there no are different speeds available on this service. NTL Freedom, also bundle phone services via CPS (Carrier Pre-Select) to users of their ADSL Broadband service.
NTL: Telewest merger
Since late 2003 there has been discussion of a merger between Telewest and NTL, the UK's other, and largest, main cable operator. Thanks to their geographically different areas NTL and Telewest have co-operated in the past, such as directing potential customers who are outside their own areas.
On October 3, 2005, NTL announced a USD$6 billion purchase of Telewest, creating one of the largest media companies in the UK. However, this merger agreement as it was structured would have left NTL having to negotiate with BBC Worldwide, the BBC's commercial arm, due to a change of ownership clause written into the agreement for UKTV, a joint venture with Telewest's Flextech content division. To prevent this, Telewest instead acquired NTL.
On March 3, 2006, NTL announced it had completed its 6 Billion USD merger with Telewest, the second largest British cable company, creating one of the largest media companies in the UK. Once this was completed, the combined company renamed itself to NTL Incorporated, with ex-NTL shareholders controlling 75% of the Stock, and ex-Telewest shareholders 25%. 9 of the 11 directors of the new board will come from NTL, with 2 from Telewest.
Telewest
Telewest (formerly 'Telewest Broadband' and 'Telewest Communications') is a trading name of NTL Incorporated.
Services
On its cable network, Telewest provides several residential services including:
- Talk Unlimited, Talk Mobile, Talk International, Talk Evenings and Weekends and Talk Weekends telephony services.
- Talk Anywhere, bundled minutes every month that can be carried over to the next. (North West customers only)
- A digital television service, formerly named Active Digital.
- Blueyonder (formerly Cable Internet), broadband Internet access via cable modems. Also available, dial-up internet services.
- An analogue cable TV service, which is due to be fully terminated in 2007.
- "Teleport" A Video on Demand service.
- "TV Drive" A Digital Video Recorder.
Telewest also provides extensive business telephony and data network services that provide a significant portion of its revenue streams, and carrier services to other telcos.
Telewest had gone through a lot of troubles recently due to its reputation for poor customer service and the huge debts it created when constructing its cable network, acquiring other cable companies and assets. In 2004 Telewest re-structured its balance sheet by swapping its unsecured debt for 98.5% of its shares. Shares were then consolidated and delisted from London. Major Telewest shareholders included Huff and Liberty Media (run by cable tycoon John Malone).
Since then, the company had emerged from financial restructuring and completed a merger with larger rival NTL.
It also owns former Deutsche Telekom company Eurobell, a cable company in Devon and Cornwall, which is fully integrated into the company now and Flextech, a content provider with a number of wholly-owned channels (including Bravo and LIVINGtv), and a half share in the UKTV venture.
NTL trading as Telewest passes approximately 4.2 million homes. blueyonder speeds offered are 2 Mbit/s, 4 Mbit/s and 10 Mbit/s with prices ranging from around £14.99 per month to £35 per month.
Blueyonder bandwidth upgrade
In August 2005, Blueyonder announced that starting in September they will be upgrading their service on an area by area basis.[1] The upgrades are expected to be finished by the end of April, 2006. The 512 kbit/s service will increase in speed to 2 Mbit/s, the 1 Mbit/s service will increase to 4 Mbit/s, and the 2 Mbit/s and 4 Mbit/s services will both increase to 10 Mbit/s. The pricing will be as follows:
- downstream 2 Mbit/s - upstream 256 kbit/s - £14.99 per month
- downstream 4 Mbit/s - upstream 384 kbit/s - £24.99 per month
- downstream 10 Mbit/s -upstream 384 kbit/s - £35.00 per month
The service is currently 'uncapped', which means that usage is unlimited; no extra charges are payable related to the amount of data downloaded.
HDTV & DVR
Telewest have launched a HDTV service and a new PVR device which is known as the TV Drive.
This news means that they are the first UK broadcaster to offer HDTV, several months earlier than their chief competitor, BSkyB.
Telewest's TV Drive product incorporates a 160 gigabyte hard drive as standard, meaning it will be able to store around 80 hours of recorded programmes. This is in contrast to BSkyB's Sky+ service which currently offers only 80 gigabytes (40 hours) as standard, with a 160 gigabyte drive available at a significant premium.
Similarly, Telewest's product incorporates three tuners while Sky's incorporates only two, meaning that Telewest's service could record two channels at the same time while watching a third.
Telewest is the first UK Television provider to offer HD content. In January 2006 they started to broadcast HD documentaries such as "the blue planet" and "Pride" through teleport and will start to broadcast HD movies in February 2006.
Teleport
Teleport is the brand name for Telewest's video on demand service (VOD). It was launched in 2005 and allows users to search through a large library of programmes and watch them at their leisure as part of their subscription.
Teleport also offers movies that can be purchased and watched as many times as desired within a twenty four hour period. Teleport also offers HD content that will work in conjunction with the TVDrive PVR.
External links
The content of this page is retrieved from http://en.wikipedia.org/wiki/NTL under GFDL
