OFT clears NTL, BSkyB mergers with Telewest and Easynet |
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Sun, 01 Jan 2006 17:25
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LONDON - NTL, Britain's biggest cable operator has received the clearance from the Office of Fair Trading to move ahead with its £3.4 billion acquisition of smaller rival Telewest. The OFT also cleared BSkyB's £211 million deal for Easynet.
The OFT said that "competition concerns raised either do not result from the mergers or are not sufficiently significant to warrant reference to the Competition Commission." Sky now has access to Easynet's 8 million customers and can provide broadband internet access for the same, but rivals like BT and Cable & Wireless are concerned that Sky would refuse to provide feed to other operators across its platform.
The OFT admitted as much saying, "third parties have raised concerns about the potential for Sky blocking the supply of pay-TV content to its emerging [broadband] rivals, given its market power in premium-content provision and its significant buyer power in non-premium content."
However, the OFT felt that Sky had the ability to do this and the merger with Easynet did not open up new avenues for the company. "If Sky's rivals want to raise new Competition Act complaints, we would look at them but we cannot do it under the Enterprise Act," a spokeswoman for the OFT said.
As far as the NTL deal is concerned, analysts feel that it will not renew its bid to take over Sir Richard Branson's Virgin Mobile, which had rejected its initial offer of £817 million in December. NTL and Telewest will now have access to five million homes in the UK.
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