FetchTV
puts
NZ
expansion
on
hold
pending
Sky-Vodafone
merger
FetchTV
has
put
its
move
into
New
Zealand
on
hold
until
the
Commerce
Commission
rules
on
the
proposed
NZ$3.4
billion
merger
between
Sky
TV
and
Vodafone
New
Zealand.
FetchTV
is
one
of a
number
of
companies
that
have
made
submissions
to
the
regulator
arguing
that
the
merger
could
potentially
reduce
competition
and
prevent
access
to
premium
content.
FetchTV
had
previously
announced
that
it
was
planning
to
bring
its
video
platform
to
the
New
Zealand
market,
although
with
no
set
timetable.
However,
CEO
Scott
Lorson
told
CommsDay
that
the
company
was
now
waiting
on
the
regulatory
outcome
of
the
proposed
merger,
noting
that
the
Commerce
Commission
could
potentially
introduce
conditions
similar
to
those
that
were
secured
during
the
Foxtel/Austar
merger
in
2012.
“[New
Zealand
expansion]
is
still
very
much
on
the
agenda
for
2017,
but
the
landscape
is
fluid
and
we
need
a
landing
given
our
B2B
approach
and
partnership
model,”
Lorson
said,
noting
that
the
company
was
also
now
actively
looking
at
expanding
into
Asia
as
well.
In
its
submission
to
the
Commerce
Commission,
FetchTV
said
that
the
SkyVodafone
merger
would
have
the
effect
of
creating
barriers
to
entry,
effectively
locking
out
FetchTV
and
other
potential
competitors
from
the
New
Zealand
market
and
enabling
the
merged
entity
to
foreclose
competition.
In
particular,
it
said
the
merger
will
enhance
the
ability
and
incentive
for
Sky
to
acquire
content
on
an
exclusive
basis.
FetchTV
noted
that
similar
concerns
relating
to
access
to
content
were
recognised
by
the
Australian
Competition
and
Consumer
Commission
in
its
merger
review
of
the
acquisition
of
Austar
by
Foxtel.
“To
ensure
that
competition
was
not
foreclosed,
Foxtel
was
required
to
provide
undertakings
that
limited
its
ability
to
acquire
content
on
an
exclusive
basis.
These
undertakings
have
been
critical
to
ensuring
the
ability
of
competitors
such
as
FetchTV
to
acquire
a
core
content
offering
that
have
enabled
it
to
compete
with
Foxtel
in
Australia.
FetchTV
encourages
the
NZCC
to
engage
with
the
ACCC
on
its
approach
to
help
build
an
understanding
of
the
impact
of
access
to
content
on
the
relevant
markets,”
it
stated
in
its
submission.
VODAFONE
RETURNS
FIRE:
FetchTV
is
not
alone
in
raising
concerns
–
carriers
including
Spark,
2degrees
and
Trustpower
have
also
voiced
their
opposition
to
the
proposed
merger.
A
key
objection
cited
by
all
three
carriers
is
the
potential
to
block
access
to
premium
content,
particularly
sport.
Concerns
were
also
raised
about
competitive
advantages
available
to
Vodafone
through
content
bundles.
However,
Vodafone
New
Zealand
yesterday
responded
to
the
various
issues
raised,
suggesting
that
the
submissions
primarily
reflect
commercial
concerns
of
the
third
parties
and
were
not
realistic.
Its
followup
submission
to
the
Commerce
Commission
argued
that
the
proposed
merger
does
nothing
to
prevent
competitors
packaging
their
products
with
additional
services
such
as
Wi-Fi,
electricity,
or
music
streaming
as
some
of
the
already
do
today.
“Rivals
will
be
forced
to
constantly
rethink
their
offering
to
ensure
the
product
they
deliver
is
what
consumers
see
as
the
best
value,”
said
Vodafone
New
Zealand
CEO
Russell
Stanners.
He
also
claimed
that
Sky
content
is –
and
will
remain
–
available
to
wholesale
to
other
providers.
In
its
submission,
Vodafone
said
that
arguments
made
against
the
merger
were
premised
on a
“wholly
unrealistic
counterfactual”
where
Sky
would
offer
bespoke
packages
at
cut-down
prices
so
as
to
allow
third
parties
to
pick
and
choose
what
content
they
want
to
add
to
their
own
packages.
“Spark
and
others
offer
no
objective
evidence
as
to
why
Sky
would
make
this
change.
In
particular,
it
does
not
address
the
commercial
implications
of
this
change
for
Sky
and
why
such
a
material
amendment
to
Sky's
current
approach
should
be
seen
as
likely
(or
even
rational),”
it
said.
According
to
the
submission,
Sky
currently
makes
content
available
to
Vodafone
on
wholesale
terms
that
are
significantly
different
to
those
envisaged
by
the
third
party
submitters.
“Vodafone
is
an
arm’s
length
willing
taker
of
these
wholesale
terms
and
that
has
provided
Sky
with
the
opportunity
to
distribute
its
content
to
more
customers.
Vodafone
has
no
reason
to
expect
that
Sky
would
depart
from
this
model,
not
least
because
it
would
facilitate
a
disaggregation
of
content
that
Sky
has
to
date
not
needed
to
consider,”
it
said.
Vodafone
noted
that
Sky
already
offers
OTT
products,
such
as
Neon
and
FanPass,
that
offer
value
alternatives
for
customers
who
do
not
wish
to
take
its
full
satellite
service.
Stanners
said
that
Vodafone
has
been
commercially
successful
in
reselling
Sky
content
over
several
years
on
its
wholesale
terms,
and
that
it
would
continue
to
do
so
in
the
event
the
merger
should
not
go
ahead.
The
Commerce
Commission
is
expected
to
make
its
final
decision
on
the
merger
on
November
11.
Geoff
Long,
Commsday
