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Before yesterdayBroadband TV News: Cable

Swiss competition authority could demand open access from UPC in Sunrise merger

By JΓΆrn Krieger

Switzerland’s competition commission Weko could approve the takeover of cable operator UPC by telecommunications company Sunrise, but only under conditions.

This reports Swiss business newspaper Handelszeitung, citing two independent sources after a non-public hearing in Bern.

The most likely condition is that Sunrise must open the UPC cable network to alternative fixed-line internet providers such as Salt, Green.ch or Init7, according to the report. At the end of May 2019, the competition authority already asked this question in its questionnaire on the proposed merger: “Do you expect Sunrise to offer wholesale products in the broadband internet and fixed-line telephony area following the takeover of UPC?”

Incumbent telco Swisscom and utilities companies already offer such wholesale products on their copper and fibre-optic networks. A UPC cable network open to third parties would create competition for alternative providers, which could lead to more price dynamics.

With such a move, Weko would follow the example in Germany: Vodafone was only allowed to take over Unitymedia under certain conditions. One of these was the opening of the cable network to competitor Telefónica.

Weko intends to decide on the merger plan by early October 2019.

Telekom Srbija completes Bosnian deal

By Chris Dziadul

Telekom Srbija’s subsidiary Mtel has officially become the sole owner of Banja Luka-based Elta Kabel, one of the largest cable TV and internet providers in Bosnia & Herzegovina.

Capital reports that as a result of the acqusition, and in line with its business strategy, Mtel will have invested around €150 million in Republika Srpska and Bosnia & Herzegovina this year.

As previously reported by Broadband TV News, the acquistion of Elta Kabel by Telekom Srbija’s Mtel was initailly opposed by the regulator RAK.

However, Mtel successfully acquired the operators Telrad and BlicNet.

Baltcom summarises investment strategy

By Chris Dziadul

Latvia’s Baltcom has invested €6.87 million in upgrading its infrastructure in the last four years.

This, according to Dienas Bizness, has allowed it to increase network capacity and provide download speeds of up to 1 Gbps.

Quoting Dmitrijs Nikitins, Baltcom’s CEO, it adds that the company “made the business decision ahead of time to continually improve our service to existing customers – if the internet is stable and fast, no one wants to look for another supplier”.

Nikitins also said that the main problems identified when starting the upgrade were the lack of network capacity and the lack of routers.

Baltcom was established in 1991 and is one of the leading electronic communications companies in the Baltic Republics.

Owned by Luxembourg-based RPAX One, it claims a number of ‘firsts’ in the Latvian market.

These include the offering the first cable connection (1997), becoming the first mobile operator (1997), the first to provided digital TV serices (2004) and the first to offer broadband internet (2008).

UPC Polska upgrades integrated offer

By Chris Dziadul

Poland’s leading cable operator UPC Polska has introduced five new integrated packages designed to complement its recently launched mobile offer.

Internetowi is designed for subscribers for who the internet is the main priority. For PLN59.99 (€13.67) a month they can receive 500 Mbps broadband, Smart Wi-Fi and 34 TV channels. Meanwhile, Super-Internetowi consists of 1 Gbps internet access, Smart Wi-Fi and 34 TV channels and costs PLN79.99 a month (PLN59.99 for the first three months).

For PLN79.99 a month customers can also opt for Telewizyjno-Internetowi, which consists of 165 TV channels, Horizon Go, 300 Mbps and Wi-Fi throughout their home.

The two higher-end packages are called Rozrywkowi and Multi-Rozrywkowi. The former, costing PLN99.99 a month, includes 500 Mbps broadband and Smart Wi-Fi, 165 TV channels, Horizon Go, Replay TV and PVR, while for PLN119.99 (PLN99.99 for the first three months) users can have 1Gbps broadband, Smart Wi-Fi, 165 TV channels, Horizon Go, Replay TV, PVR and Premium HBO.

Customers can also opt for Polsat Sport Premium and Eleven Sports, as well as HBO, for PLN19.99 a month each.

Meanwhile, UPC Polska’s new mobile offer can be accessed in any one of five packages, costing from PLN9.99 to PLN59.99 a month.

Vodafone initiates Unitymedia integration

By JΓΆrn Krieger

Following the approval of the merger by the European Commission, Vodafone has commenced integrating its networks and products with Unitymedia in the German cable market.

As the first step, the more than 600 Vodafone and Unitymedia shops in federal states North Rhine-Westphalia, Hesse and Baden-Württemberg served by Unitymedia’s cable network will offer joint fixed-line and mobile products from September 2, 2019.

Vodafone will inform Unitymedia customers about this with a personal welcome letter. This includes voucher codes for gifts such as mini Wi-Fi routers, additional data volume for mobile surfing and products combining Vodafone’s mobile network and Unitymedia’s fixed-line network at reduced prices.

Vodafone ADSL customers in the Unitymedia coverage area can also switch to a more powerful Unitymedia cable subscription at the same price as new customers, if available at the customer’s household.

Meanwhile, the analogue FM cable radio stations on Unitymedia’s network will remain available after the merger with Vodafone for the time being, a Unitymedia spokesman told Broadband TV News, one of the reasons being the comparatively low distribution of digital radio receivers.

However, the aim was to completely digitise the cable line-up in future, but no date has yet been set for this, said the spokesman. “We are in ongoing talks with our partners about this,” he added. “The free spectrum can then be used one day for the expansion of the internet upstream.”

Vodafone discontinued analogue cable radio carriage in the course of analogue TV switch-off, while Unitymedia continues offering its customers analogue FM radio stations in addition to the digital DVB-C cable radio portfolio.

Sky could invest in Liberty Global fibre network

By Julian Clover

Sky is in talks over a potential investment that could see it join Liberty Global in the build of a new fibre network to compete with BT.

The Financial Times reported that Sky is in early stage talks with Liberty that would see the Comcast-owned company become both an investor and customer of the venture.

Last week, Liberty formally registered the venture as Liberty Fibre Ltd at Companies House.

Investment bank LionTree has been appointed to find new partners for the venture that would install new fibre lines outside the Virgin Media footprint.

Sky is in separate talks to use Virgin Media’s existing cable network which reaches around 50% of the country.

Last month, Virgin announced plans to offer a gigabit internet service to almost 15 million UK homes, while Sky has also announced a significant upgrade to its broadband platform with speeds up to 12 times faster than its standard broadband.

Meanwhile BT, TalkTalk and number of smaller players including the Goldman Sachs-owned CityFibre are also investing in full fibre networks.

ProSiebenSat.1 to launch Austrian news channel Puls 24

By JΓΆrn Krieger

While ProSiebenSat.1 sold its news channel N24 in Germany, the German media company is now returning to the news business in Austria.

Austrian subsidiary ProSiebenSat.1 Puls 4 will launch Puls 24 on September 1, 2019. The ad-supported free-to-air news channel will show breaking news, live events and interviews 24 hours per day.

DTH satellite households will be able to receive Puls 24 unencrypted via Astra (19.2° East). The channel will also broadcast on Austrian cable networks, through an Android/iOS app for smartphones and tablets and as a live-stream on its website.

Setanta Sports expands in Ukraine

By Chris Dziadul

Ukraine’s largest cable operator Volia has added Setanta Sports to its digital and interactive TV packages.

The channel is initially being made available in 10 cities, including the capital, Kiev, for a promotional price of UAH99 (€3.52) a month.

Commenting on the development, Volia’s CEO Anton Dzyubenko said: “Sport is an integral part of our society, which is why sports content is increasingly used on the TV market as a primary differentiator and argument for customer engagement. This is due to the fact that in Ukraine there is a great demand for niche sports channels, which is still not satisfied. Another TV channel about sports in Volia packages is a logical step towards our subscribers and their needs in various and high quality sports content”.

Dwyer McCaughley, CEO of Setanta Sports Eurasia, added: “We are pleased to launch Setanta Sports on the Volia platform and look forward to presenting a wide range of our sports broadcasts to the company’s subscribers. The English Premier League is of considerable interest to Ukrainian football fans and we already have many positive comments about the channel. We look forward to working with Volia in the coming months and years and want to deliver our content to the largest possible subscribers base”.

Setanta Sports made its debut in Ukraine earlier this summer and is already offered by – amongst others – the OTT services Megogo, Divan.TV and Oll.tv.

Vodafone outlines UPC Romania plans

By Chris Dziadul

The team charged with integrating UPC’s operations with Vodafone in Romania will consist of around 100 people.

According to Murielle Lorilloux, CEO of Vodafone/UPC Romania, speaking to Ziarul Financiar, it will be composed of employees from both companies and work for at least two years.

Once the integration is complete, the company will be one of the largest fixed and mobile operators on the Romanian market, with an annual turnover of €1 billion.

Vodafone recently completed the acquisition of Liberty Global’s assets in Germany, Romania, Hungary and the Czech Republic in a deal worth €18.4 billion following the approval of the European Commission.

Liberty Global stays committed to UPC/Sunrise deal

By JΓΆrn Krieger

Liberty Global remains committed to selling its Swiss cable subsidiary UPC to local telco Sunrise under the agreed terms.

Liberty Global notes the recent statements by Freenet and Sunrise with respect to the proposed acquisition of Liberty’s Swiss operation by Sunrise, the company said in a statement.

Liberty Global is fully committed to completing the transaction as agreed. The company has not had any discussions regarding amending the binding transaction terms, and has no intention or interest in doing so, according to the statement.

German media company Freenet, a major shareholder in Sunrise, recently affirmed its opposition against the acquisition of UPC, arguing that the price was too high and the conditions unfavourable.

At the extraordinary general meeting later this year, Freenet will therefore reject Sunrise’s proposed capital increase of CHF4.1 billion (€3.8 billion) associated with the CHF6.3 billion (€5.8 billion) acquisition announced in February 2019.

With a shareholding of around a quarter of the shares, Freenet will not be able to block the acquisition on its own, but its strong opposition could attract the attention of other, smaller shareholders who could also turn down the transaction.

UPC Switzerland gears up for 1Gbps internet

By JΓΆrn Krieger

Swiss cable operator UPC is currently preparing the introduction of 1Gbps internet access which it wants to make available on its entire network later this year.

The move is part of the CHF275 million (€253 million) the Liberty Global subsidiary is investing in its products, network and customer service in 2019.

UPC stresses that, unlike its competition, which currently only offers gigabit speeds in metropolitan areas, the company will be the only provider in Switzerland capable of introducing gigabit speeds across its entire coverage area – urban and rural – thanks to its fibre-optic cable technology.

“With the introduction of nationwide gigabit offers, we are taking digitisation in Switzerland to a new level,” said UPC CEO Severina Pascu. “On the one hand, rural regions will gain access to gigabit speeds for the first time ever, benefiting both residential and business customers throughout the country, while on the other hand we are offering an attractive alternative in cities with existing gigabit offerings.”

As part of the preparations for 1Gbps internet, UPC will run certain network adjustments on August 27, 2019. During this time, some TV services might be impacted.

After the adjustments have been completed, the majority of TV devices – such as UPC TV and Horizon recorders – will automatically recognise the changes and run a channel search. On older TV sets directly connected to the cable network, customers may have to perform a channel search manually.

Detailed information and instructions can be found at www.upc.ch/change.

UPC Polska boosts internet speeds

By Chris Dziadul

Over 2 million homes in UPC Polska’s network can now opt for internet access of up to 1Gbps.

This follows the introduction of Giga services in the cities of Ruda Slaska, Tychy, Lubin, Gdynia and Sopot.

Such services are already available in Warsaw, Gdansk, Szczecin, Bydgoszcz, Wroclaw, Katowice, Czestochowa and Krakow, with Sosnowiec due to be added to the list at the beginning of September.

UPC Polska had 1,203,400 internet subscribers at the end of Q2, or 55,600 more than a year earlier.

Furthermore, over 654,000 of its customers used a Connect Box.

Sky Deutschland starts SD switch-off on cable

By JΓΆrn Krieger

German pay-TV broadcaster Sky Deutschland continues the HD offensive launched in November 2018 in the DTH satellite market and commences SD switch-off on the two largest cable networks.

Vodafone and Unitymedia customers subscribing to basic packages Sky Starter and Sky Entertainment will be able to watch the following channels in HD quality from October 8, 2019: Sky Krimi HD, Disney Junior HD, Beate Uhse.TV HD, 13th Street HD, Syfy HD and Universal TV HD. Sky Krimi HD will also become available to DTH satellite households on Astra (19.2° East).

Vodafone and Unitymedia cable customers with a Sky Sport subscription will also receive Sky Sport 6 HD and Sky Sport 7 HD. Two HD channels will be added to the Bundesliga package: Sky Sport Bundesliga 5 HD and Sky Sport Bundesliga 6 HD.

The new and existing HD channels will replace the corresponding SD versions from October 8. SD channels that have not been converted to HD will remain available in SD resolution.

The following channels of the Sky Starter and Sky Entertainment packages will no longer be available in SD at Vodafone and Unitymedia, but exclusively in HD from October 8: Disney Junior, Beate Uhse.TV, 13th Street, Syfy, Universal TV, Fox, TNT Series, NatGeo Wild, Sky 1, National Geographic, Discovery Channel and Sky Krimi as well as Sky Atlantic (only via Sky Entertainment).

The transition to HD will be free of charge and automatic for customers with Sky set-top box. Subscribers receiving the channels with a CI+ module or third-party receiver may have to perform a channel search.

Salt adds RTL pay-TV channels in Switzerland

By JΓΆrn Krieger

The pay-TV channels operated by German broadcaster Mediengruppe RTL Deutschland have joined the IPTV platform of Swiss telco Salt.

RTL Crime, RTL Passion, RTL Living and GEO Television are offered as part of the German-language exclusive package costing CHF14.95 (€13.75) per month.

Distribution is in HD quality.

Home & Garden TV joins M-net

By JΓΆrn Krieger

German network operator M-net has added free-to-air TV channel Home & Garden TV (HGTV) to its internet TV service TVplus.

M-net TV plus can be signed up for as an option to any Surf&Fon fibre-optic or ADSL subscription with a bandwidth of at least 18Mbps.

M-net also plans to distribute the Discovery-owned lifestyle channel, which launched on June 6, 2019, on its cable TV network soon.

Altice channels still on Free, for now

By Julian Clover

Altice channels BFMTV, RMC Découverte and RMC Story remain available on the French IPTV network Free, despite the passing of a deadline on Friday that was expected to lead to their removal.

Altice and Free had failed to agree on a retransmission agreement for the DTT channels.

The two companies have been in on-off talks since the spring. While Altice wants payment for the linear channels, Free will only agree to compensation for the accompanying on demand services.

In its Friday newsletter Le Journal du Dimanche said there had been a misunderstanding; rather than setting Friday as a date for the channels’ removal, Free had instead wanted to know by August 16th whether Altice was happy for the channels to continue to be available via the Freebox.

The actual deadline is in fact August 27th.

Report: Dunn to lead Liberty’s UK full fibre push

By Julian Clover

Veteran Virgin Media staffer Robert Dunn is being tapped for a new role at parent Liberty Global that would see the company develop full fibre broadband in smaller UK towns and rural areas.

There are still significant gaps in broadband coverage outside Britain’s major conurbations.

According to an internal memo seen by the Financial Times, Mr Dunn would move to a new role at Liberty Global “looking at potential infrastructure investments in the UK”.

Contacted by Broadband TV News, Virgin confirmed that Mr Dunn would be leaving his CFO role, but declined to comment further.

The FT says Mr Dunn would join a new joint-venture company being established by investment bank LionTree to install new fibre lines outside the Virgin Media footprint.

Last month, Virgin announced plans to offer a gigabit internet service to almost 15 million UK homes. It comes amid political pressure from new prime minister Boris Johnson to improve the country’s broadband infrastructure.

Openreach, which supplies broadband infrastructure to BT and a number of independent operators, has also ramped up its plans, adding a further 36 locations to its plans.

Mr Dunn will depart after 19 years with Virgin and its predecessors. Bill Castell, his deputy and a former chief financial officer of Barclays’ corporate bank and Barclaycard in Europe will becoming acting CFO.

Freenet opposes UPC acquisition by Sunrise

By JΓΆrn Krieger

German media company Freenet, a major shareholder in Sunrise, will vote against the Swiss telco’s proposed takeover of cable operator UPC Switzerland, arguing that the price was too high and the conditions unfavourable.

At the extraordinary general meeting later this year, Freenet will therefore reject Sunrise’s proposed capital increase of CHF4.1 billion (€3.8 billion) associated with the CHF6.3 billion (€5.8 billion) acquisition announced in February 2019.

With a shareholding of around a quarter of the shares, Freenet will not be able to block the acquisition on its own, but its strong opposition could attract the attention of other, smaller shareholders who could also turn down the transaction.

According to Freenet, the purchase price and implied valuation for UPC Switzerland is too high, in particular in light of the cable industry being under severe pressure and UPC Switzerland’s operational performance, adding that for a fair transaction for all Sunrise shareholders, the purchase price should be lowered.

Freenet also opposes the condition that potential synergies amounting to CHF1.3 billion are being paid to Liberty Global in advance, arguing that for a fair transaction for all Sunrise shareholders, Liberty Global should become a shareholder of the combined entity and receive a lower portion of the potential synergies. Further criticism focuses on the transaction, capital and debt structure of the proposed deal.

In a statement, Sunrise said that the company has taken note of the announcement by Freenet to vote against the rights issue related to the acquisition of UPC Switzerland, adding that Sunrise remains convinced that the acquisition creates a “stronger and more valuable Sunrise”, benefitting from a “compelling strategic rationale”.

Sunrise will provide an update on the acquisition of UPC Switzerland as part of its Q2 2019 results announcement on August 22, 2019.

Mixed cable and DTH fortunes for Digi

By Chris Dziadul

Digi Communications saw its Romanian cable RGU total grow by 9.5% to 3,447,000 in the year to June 30.

At the same time, cable ARPU increased by 3.9% to €5.3. On the other hand, its DTH RGU total fell by 8.3% to 517,000 over the same period, while DTH ARPU rose by 6.3% to €5.1.

Meanwhile, in Hungary the number of cable RGUs grew by 1.8% to 696,000, while cable ARPU fell by 2.4% to €8.

DTH RGUs fell by 7.7% to 276,000 and DTH ARPU by 1.1% to €9.1.

In revenue terms, cable TV revenue in Romania in H1 amounted to €105.6 million, up 12.7% on the same period last year, while DTH revenue fell by 7.2% to €15.5 million.

Total revenues in H1 were, at €367.2 million, 8.8% higher than a year earlier.

In Hungary, cable revenues in H1 grew by 28.7% to €36.1 million, while DTH revenues fell by 8% to €15 million.

Total revenues were 37.3% higher at €110.4 million.

The company’s combined revenues in all the markets it operates in amounted to €575.2 million in H1, up from €486.4 million a year earlier.

Its profit for the first six months of the year was €3.2 million, down from €12.9 million in H1 2018.

UPC Polska hit by heavy fine

By Chris Dziadul

Poland’s leading cable operator UPC Polska has been fined almost PLN33 million (€7.61 million) by the Office of Competition and Consumer Protection (UOKiK) for using prohibited clauses.

In a statement, UOKiK says it received complaints about UPC Polska unilaterally turning off certain channels and increasing its subscription fees. It therefore analysed the T&Cs and contractual templates and issued a decision finding the clauses used by UPC Polska to be prohibited. UOKiK continues by providing a detailed explanation as to why the clauses were illegal. This is as follows:

UPC Polska guaranteed only a number of TV channels on a certain subject matter and not specific channels indicated on the list. This was because the operator granted itself the right to change channels freely and unilaterally and could remove them during the term of the contract, as confirmed by consumer complaints. Many people chose UPC’s offering because of the availability of specific channels. Subsequently they were turned off.

UPC Polska stipulated that turning off channels was not an amendment to the contract. As a result, with fixed-term contracts, the consumer would have to pay fees if they wanted to opt out of UPC services. In the opinion of the Office of Competition and Consumer Protection, the operator may not change the material terms and conditions of its fixed-term contracts, which include the list of channels. In such a situation, individuals on fixed-term contracts should have the right to opt out of UPC services. In contracts for an indefinite period of time, channels may change only for important reasons specified in the T&Cs or contract.

Fee increases for no particular reason. UPC reserved the right in contracts to increase the subscription fee from PLN5 to PLN8 once a year, but did not specify the reasons for this.

Arbitrary decisions on whether a technician callout was unjustified. In such a situation, UPC would charge the consumer a fee of PLN50. The assessment of whether a service callout was necessary was unilateral and could not be verified by the consumer. This may also have discouraged customers from making a complaint.

Too general conditions for termination of the customer’s contract or a lack thereof. For example, UPC stipulated that it may do so for “important reasons, in particular legal, technical, organisational or economic reasons”. Thus, the customer did not know what factors could render them unable to use UPC services.

UOKIK concludes by saying it has fined UPC Polska a total of PLN32,858,511 and ordered the company to to inform its consumers about the decision and to reimburse fees resulting from subscription increases or unjustified technician callouts. The entity should also restore cancelled TV channels to customers if they are still available in its offer.

The also says that the decision is not legally binding.

UPC Polska responded to the decision by saying: “UPC stands out on the market in the value it provides to its customers and acts according to the highest transparency standards. While we appreciate the attention of UOKiK to the consumer protection, we strongly disagree with the interpretation of UPC’s specific contractual clauses. We believe such decision, questioning our practices since 2015, hinders market development, consumer choice and innovation, differentiating competition conditions for market players. Supported by the top experts in the field, we will appeal UOKiK’s decision, expecting that the court will confirm our position. We will continue to serve our customers providing increasing value and choice.”

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