THE RUMOR MILL: SPECTACULAR MOVES ON THE COMMUNICATIONS MARKET Vodafone could acquire UPC

After the agreement of American group Verizon Communications, to buy the 45% stake owned by Vodafone in their joint-venture in the US, the market has began fretting over the rumors that British group Vodafone may acquire Liberty Global (UPC), the largest cable company in Europe. Following the deal between Verizon and Vodafone, which is scheduled to be completed in Q1 2014, the British Company would receive 130 billion dollars, of which 58.9 billion dollars in cash, which has given more credence to rumors among telecom analysts that Vodafone will try to enter the TV cable market by acquiring Liberty Global, owned by American billionaire John Malone. According to Denver Business Journal, John Malone would not turn down a convenient offer. Liberty Global is the largest cable company in Europe, with 25 million customers in 15 countries, including Romania.

• What would this deal mean for our country

Such a deal would cause even more turmoil on the Romanian communications market. There are currently three major competitors in the TV cable industry: RCS&RDS, which has approximately 3.5 million subscribers, UPC, with 1.3-1.5 million customers and Dolce, the service provided by Romtelecom, which has approximately 1.5 million customers. Recently, Orange entered the market segment, which launched its TV service in June this year. For now, the representatives of Orange, which is the largest mobile telephony operator, estimate that its service will have around 50,000 subscribers by the end of the year, but it is to be expected that by the end of the year, the company will develop its own TV stations, according to the model followed by Digi, (RCS-RDS) and Dolce. The acquisition of UPC by Vodafone would create the highest level of competition between the British company and RCS-RDS, as Romtelecom and Orange TV would be forced to find solutions to deal with the situation.

Another important factor in the equation of the Romanian cable TV industry comes from the TV broadcasting rights of the football matches in the first domestic league. They have played a crucial role in the current market saturation, as RCS-RDS and Dolce paid over 100 million Euros two years ago in order to have the exclusive rights to broadcast the matches of the First League, which led to a significant migration of the TV subscribers towards the two companies. Despite the fact that a new call for bids will be held last year for the assignment of the TV broadcasting rights of the national football championship, cable companies are not willing to pay more than half of what they paid up to now, as the Romanian First Football League is becoming increasingly attractive to citizens, from one year to the next. Given the situation, the president of the Romanian Professional Football League (LPF), Dumitru Dragomir, has already announced a new grandiose project, created in cooperation with a Dutch company, which is slated to broadcast the games of the First League starting with the summer of 2014. Under these circumstances, even if no details have been offered in relation to this project, it is to be expected that a new power center will appear on the Romanian media market. Market sources also said that the project of the head of the LPF may be done precisely with the newly created Orange TV, which would deal a true blow to competitors and for the overall industry.