Would this segregation be the "Dane Law" established in the eastern part of England? I believe you can note its spread by the germanic names of towns. The locals paid the germanic people a Danegeld to keep them from raiding.
The Viking people who populated Iceland brought their wives and livestock, but the freeman of the farmstead commonly had celtic slaves. I don't know why it would be different in England.
The Danelaw was 9th century, and was imposed (as one might expect) by the Danes when they arrived in force. There was also the Danegild, which was a ransom (more accurately, protection money) paid by the Anglo-Saxon kingdoms to keep the Danes from making war on them.