U.K. satellite pay-TV operator BSkyB is likely to come under more pressure from cable following the Oct. 3 announcement of a merger between the United Kingdom’s two cable operators, NTL and Telewest.

NTL will acquire Telewest for 3.4 billion pounds ($6 billion) and the combination is expected to create around 1.5 billion pounds ($2.6 billion) in synergies. The combined company will have more than 5 million residential customers in the United Kingdom.

In the digital television market, NTL and Telewest have a combined subscriber base of more than 3 million customers, while BSkyB has close to 8 million subscribers. However, both cable operators have aggressively targeted the digital television market, launching video-on-demand services in 2005. At the end of June, digital television penetration in the United Kingdom was close to 65 percent, with just under 16 million digital television households.

The deal is subject to regulatory and shareholder approval and expected to close in the first quarter of 2006.