“I think they will go for a strategy of optimising their revenue, which is probably to keep premium pricing where they don’t have fibre competition, rather than bringing down pricing to maximise the take-up,” Karen Egan, head of telecoms at Enders Analysis said. 

A Netomnia-Nexfibre combination would create an 8mn-home fibre network. BT’s Openreach serves nearly 25mn homes with fibre broadband, while its retail division has 30 per cent market share, according to estimates from Enders Analysis. 

“The financial community has begun to recognise creators as proper businesses,” says Ben Woods, head of creator economy at Enders Analysis.

The deal would mark the first move towards consolidation in the broadband industry, which has come under mounting pressure from higher interest rates on its rising debt levels, which stand at more than £9bn, according to Enders Analysis. 

The cost of building out networks has left the lossmaking “altnets” saddled with over £9bn in net debt, according to calculations by Enders Analysis. Some providers, such as London’s G.Network, have fallen into administration, while lenders to others have been forced to write down the value of their debts.

“The crucial difference between these deals is that TalkTalk is a proven failed-firm situation, with it having been publicly for sale for at least the past four years but with no credible buyer,” said Karen Egan, head of telecoms at Enders Analysis.

Enders Analysis has identified Virgin Media O2 and CityFibre as leading consolidators, as several heavily indebted fibre networks struggle to win sufficient business to justify high investment levels.

“The overarching problem is the amount of long-form content people watch is going down,” Tom Harrington, head of television at Enders Analysis, said. “If the whole thing is shrinking … then that’s a challenge for every broadcaster and streamer.”

Skydance has a net debt of roughly $80bn, or around seven times its profits. That is almost three times higher than the 2.5x level normally associated with the industry, according to Enders Analysis.

Karen Egan, at telecoms research group Enders Analysis, said: “Equity shareholders will be asking for some pain on the debt side of the equation in return for the £900m of equity injection, even if that pain isn’t in the form of an official write-down of the debt stack.”

The European contest has achieved success online by expanding the cultural relevance of existing entertainment intellectual property. It remains to be seen whether Eurovision Asia can “drive comparable engagement for a sister brand that does not carry the same heritage and audience buy-in,” says Ben Woods, head of creator economy at Enders Analysis.