British Sky Broadcasting (BSY.LN) is in talks to buy Time Warner's AOL U.K. operations (MarketWatch). CEO James Murdoch (son of Chairman Rupert Murdoch) said at the recent launch of Sky's broadband service. Sky runs the most popular digital television subscription service in the United Kingdom. But James is looking for a bargain at this point; after all, Time Warner (TWX) is in a period of transition, deciding whether to give away all those currently paid-subscriber-only AOL features. The Market Watch piece quotes the Sky CEO saying he will not "overpay" for AOL UK, and also notes that the £600 Million (nearly US $1.1 billion) price tag associated with AOL UK is considered much too high by insiders.
Given that, it is hard to gauge how deep Murdoch's interest is. Perhaps he is only seeking to attach Sky's name to a major deal that makes it clear how significant a presence in broadband he intends for BSB. He anticipates that a third of current Sky television subscribers will also sign up for the new broadband service with the company by 2010.
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