Telefónica edges closer to Canal+ buyout

DetailsJuan Fernandez Gonzalez | 17 April 2015

The merger of Spain's two largest pay-TV operators is close to being approved by the country's competition authority, Comisión Nacional de los Mercados y la Competencia (CNMC), enabling Telefónica to purchase Canal+ along with its 1.6 million subscribers.

According to El Economista, naming inside sources, Telefónica has proposed the creation of a wholesale platform with half of all the premium content it owns, including Movistar TV and Canal+, a solution which has been approved by CNMC.

This content will be available for all competitors, including Vodafone – the third largest player after buying ONO – and Orange TV, as well as all over-the-top (OTT) and video-on-demand (VOD) platforms.

The monopoly of content was the CNMC's main concern, but the authority has also imposed other limits on the agreement, such as a delay in permission to offer a Movistar-Canal+ merged offer and stating that Telefónica has an obligation to look after optimal network conditions for the development of forthcoming VOD and OTT services like Netflix.

With these conditions, the CNMC seems ready to make a decision before the end of April, a move initially expected in December 2014 as the agreement between companies was reached in May 2014.

Once the deal is concluded, the resulting company will be the largest pay-TV operator in Spain by far. Canal+'s 1.6 million subs will be added to the two million subs recently announced by Telefónica's Movistar TV, while Vodafone's ONO has around 800,000.