Vodafone urges Spanish authorities to stop Telefónica-Canal+ buyout

DetailsJuan Fernandez Gonzalez | 16 January 2015

With a final decision expected soon regarding Telefónica's bid to purchase Canal+, Vodafone has added more fuel to the fire by publicly pressing the Spanish competition authority to stop the deal taking place.

Vodafone's director for legal and regulation issues, Pedro Peña, has analysed information from the Comisión Nacional de los Mercados y la Competencia (CNMC) regarding fibre-to-the-home (FTTH) and pay-TV in the country and has warned about the risks of a monopoly in the audiovisual market, an issue that also concerns both the CNMC and the European Commission.

Peña has urged the CNMC to either prevent the buyout or lay down very strict conditions to guarantee continued market competition. He argued that there is no point having an extensive, competitive network if the content is going to be controlled by one company.

Vodafone would be one of the companies most affected by the deal as the British telco owns ONO, Spain's third largest pay-TV operator.

The country's authority is now going through the final steps of analysing the proposed buyout, although the second phase started in November and a final decision was expected before the end of 2014.

The CNMC has previously stated that it would study the move carefully as it 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 subscribers, 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 bid, the telco would own over three million subs in a market which has just surpassed the five-million barrier.