Liberty Global’s New U.K Boss Ramps Up Speed War With BT

(Bloomberg) -- Virgin Media pledged to connect 15 million homes to ultra-fast broadband in the U.K. by 2021, stepping up competitive pressure on Britain’s dominant phone carrier BT Group Plc.

It’s the first big move by Lutz Schueler, who took over as chief executive officer of Liberty Global Plc’s biggest unit last month.

The U.K.’s top two network builders are racing to provide gigabit-per-second download speeds that enable services like cloud gaming, virtual reality entertainment and ultra high-definition video streaming. Regulators are pushing for higher speeds and a wave of private equity investment into smaller rivals is also encouraging the largest companies to act.

Liberty Global, billionaire John Malone’s European cable company, is increasingly focused on the U.K. after agreeing to sell its German and eastern European businesses to Vodafone Group Plc -- a deal cleared last week by the European Commission. It will receive roughly 10.8 billion euros ($12 billion) in cash.

Virgin Media will achieve the speeds by adding fiberoptic lines and upgrading its existing cables with a technology called Docsis 3.1. Former state monopoly BT is upgrading its copper-based system to faster and more reliable fiber and accelerated its full-fiber plans in May. Unlike Virgin, BT also wholesales its broadband to retailers like Sky Plc and Vodafone.

The announcement was welcomed by the outgoing head of U.K. communications regulator Ofcom, Sharon White. “This shows the race to roll out ultrafast speeds to people and businesses across the U.K. is really gathering pace,” she said.

The pledge may also please new faces in government. It comes one day after the U.K.’s ruling Conservative Party installed Boris Johnson as prime minister. He has pledged to accelerate the previous administration’s broadband target by eight years to make full-fiber connections available to every home by 2025.

To contact the reporter on this story: Thomas Seal in London at tseal@bloomberg.net

To contact the editor responsible for this story: Rebecca Penty at rpenty@bloomberg.net

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