Wednesday, November 30, 2005

Jupiter: 3 buys 7: when telcos acquire TV firms

Thomas Husson at JupiterResearch blogs about 3 Italia's acquisition of Canale 7, a private TV station for somewhere in the region of 30 and 35 M euros. Husson writes 3 will "invest over 200M euros in the development of new services," amd "also announced its IPO to be postponed to 2006."

Husson claims the main reason for the deal is "Channel 7 holds a network license for national digital TV distribution on terrestrial frequencies. The transaction will thus enable 3 Italia to implement a DVB-H network for its clients and to develop a Pay-TV and interactive services offer for videophones with the combined UMTS/DVB-H technology."

Husson also points out the xenophobic comments from Telecom Italia's CEO, who said "There are reasons to be worried when a Chinese operator starts buying frequencies in our domestic market being ready to lose billions without any business model."

Seems a bit over the top to me. Is Hutchison, which owns 3, a Chinese operator or a company run by Chinese? There is a difference ya know. Given Hutchison's capitalistic roots in Hong Kong and their ability to take on incumbent government monopolies, I think Telecom Italia should be worrying about more than where 3's parent is from....