Spanish watchdog fears Telefónica-Canal+ buyout will damage competition
Juan Fernandez Gonzalez
| 14 November 2014
The Spanish competition authority has begun the second phase of analysing Telefónica's bid to purchase 100% of Canal+, a move which would considerably change the pay-TV market in the country.

Although both companies had hoped the EU watchdog wouldn't interfere in the deal, the Comisión Nacional de los Mercados y la Competencia (CNMC) considers the move could damage competition within Spain's pay-TV and audiovisual industries.

The CNMC says it will carefully study the move, which would result in a high market concentration. If the deal goes ahead, Telefónica will own 100% of Canal+, currently controlled by Prisa Group.

Looking at the current pay-TV market in Spain, it's easy to see where CNMC's concerns are coming from. Telefónica's Movistar TV with 1.6 million subs tops the sector with Canal+, which also has 1.6 million subs, while the next nearest competitor is Vodafone's ONO with around 800,000 subscribers. As a result of Telefónica's offer, the telco would own over three million subs in a market which has less than five million in total.

The CNMC is also concerned about the resulting company having too much power over exactly which channels and content would be included in its pay-TV platform, thus affecting network availability for other platforms.

It is expected that CNMC will reach a decision before the end of the year.