What changes if Telefónica buys Digital+?

At the end of the month Spanish audiovisual company Sogecable must make a decision on the winning bidder for Digital+. What would change if the country’s biggest telco Telefónica won, taking into account it is already one of Digital+’s most important owners with nearly 17% share?

Analysts say Telefónica would change nothing or nearly nothing relating to its subscribers. And according to a recent report carried out by Telefónica among a group of Digital+ users, they don’t think the new situation would change for them in terms of new channels or new packages.

But Telefónica is very interested in knowing whether Digital+’s subscribers want to continue with their present offer or if they prefer changing to a new pay TV operator over the next few months. The telco also wants to know if they agree with the quality of content for price of the offer or if they would prefer to go for the digital free-to-air offering of DTT.

If Telefónica did buy Digital+, subscribers of the resulting operator would have the possibility of buying the pay TV offering together with the DSL internet service Telefónica has now, as well as its traditional telephony services for free. Telefónica wants to offer DSL to those homes which don’t yet have it as well as its telco competitors subscribers so it can offer them Imagenio, it’s DSL TV service.

Other novelties regarding the management of Digital+’s present owners would be the commercialization of those HD services either Digital+’s HD decoder (called iPlus) and of those HD channels (for the moment only Canal+ HD although it¹s been announced three other HD channels all Canal+s versions). Here Telefónica would integrate in this decoder new functionalities such as programming recording contents from the internet or from the mobile phone.

In the long run if Telefónica buys Digital+ its plans would be to standardise channel offerings on satellite (Digital+) and DSL but at the same time offering value-added services such as VOD to subscribers through the telephone line or the optic fiber line the company is building across Spain. However, competition authorities could put handicaps on that because they think it goes against the free telecommunications market.

But would there be much change really? After all, Telefónica’s Imagenio and Sogecable’s Digital+ already enjoy an agreement by which Digital+ subscribers have access to Imagenio’s services and the reverse in those areas where they could not receive them so far. The agreement celebrates in November its first anniversary.