The Office of Fair Trading (OFT) has passed the merger of NTL and Telewest, as well as BSkyB’s acquisition of telecoms firm, Easynet.
Announcing its decision to the city, the OFT stated: “Both cases relate to the emergence of Digital Subscriber Lines (DSL) as an alternative means to provide ‘triple-play’ (pay-TV, internet and telecommunications) services,” and that “the test for merger reference to the Competition Commission is not met in either case.”
BSkyB’s purchase of Easynet will benefit the satellite firm’s customers, offering them ‘triple-play’ services and giving the company an infrastructure allowing it to launch new products and services (see Sky Close To Completing EasyNet Deal).
The Government body added: “Competition between Sky and Easynet is currently insignificant but third parties have raised concerns about the potential for Sky blocking the supply of pay TV content to its emerging DSL rivals.” However, the OFT dismissed such fears, saying: “Sky already has the potential to do this and the merger does not materially alter its incentives.”
Meanwhile, the merger of NTL and Telewest will see the creation of a cross-platform media provider, with 2.5 million broadband customers, 4.3 million fixed-line telephone accounts, more than 5 million mobile phone customers providing revenues in excess of 4 billion (see Virgin Mobile Backs Away From NTL Deal).
Commenting on the take-over the OFT ruled that the companies respective local networks do not overlap in any areas except those which are already closely competitive with other providers.
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