Vodafone / SKY merger

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MikeB4
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#1724886 23-Feb-2017 09:04

I am not sure I fully agree with the decision. This could well see both being sold. If they end up in equity companies hands NZ will be the worse off as they are notorious for wrecking companies.

Here is a crazy notion, lets give peace a chance.

tdgeek

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#1724893 23-Feb-2017 09:11

MikeB4:

I am not sure I fully agree with the decision. This could well see both being sold. If they end up in equity companies hands NZ will be the worse off as they are notorious for wrecking companies.

The concern seems to be that Voda will have too much influence over non Voda users. Companies merge to share and reduce costs. Fellett has now said that he will be working with all telcos, that is a benefit.

Sky, once the Optus contract is renewed at a much lower cost, or they go via broadband instead and dump satellite, will need to restructure the business, that will reduce costs.

Until then, stick with it, no real choice.

Jas777

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#1724901 23-Feb-2017 09:21

Reduction of costs for SKY will more than likely affect NZ based content and minor sports. The cost to produce a sports event v buying the rights of an already overseas produced event must be quite high.

So see things like the softball tournament they recently covered not covered anymore.

Would also think moving to broadband actually annoying more customers than it brings new ones.

freitasm

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#1724910 23-Feb-2017 09:32

Full release:

Commission declines clearance for Vodafone/Sky merger
The Commerce Commission has declined to grant clearance for the proposed merger of Sky Network Television and Vodafone New Zealand.

The Commission’s assessment focused on the impact of the proposed merger on competition in both the broadband and mobile telecommunications markets. To grant clearance, the Commission would need to be satisfied that the proposed merger would not be likely to substantially lessen competition in any market in New Zealand.

Chair Dr Mark Berry said the Commission outlined its concerns with the proposed merger in a Letter of Unresolved Issues in October last year and subsequent submissions had not resolved these concerns. As a result, the Commission had not been able to exclude the real chance that the merger would substantially lessen competition.

“The proposed merger would have created a strong vertically integrated pay-TV and full service telecommunications provider in New Zealand owning all premium sports content. We acknowledge that this could result in more attractive offers for Sky combined with broadband and/or mobile being available to consumers in the immediate future. However, we have to take into account the impact of a merger over time, and uncertainty as to how this dynamic market will evolve is relevant to our assessment,” Dr Berry said.

“Around half of all households in New Zealand have Sky TV and a large number of those are Sky Sport customers. Internationally, the trend for bundles that package up broadband, mobile and sport content is growing. Given the merged entity’s ability to leverage its premium live sports content, we cannot rule out the real chance that demand for its offers would attract a large number of non-Vodafone customers.

“To clear the merger we would need to have been satisfied that it was unlikely to substantially lessen competition in any relevant market. The evidence before us suggests that the potential popularity of the merged entity’s offers could result in competitors losing or failing to achieve scale to the point that they would reduce investment or innovation in broadband and mobile markets in the future. In particular, we have concerns that this could impact the competiveness of key third players in these markets such as 2degrees and Vocus.

“This is also against a backdrop of fibre being rolled out, making it an opportune time for the merged entity to entice consumers to a new offer. If significant switching occurred, the merged entity could, in time, have the ability to price less advantageously than without the merger or to reduce the quality of its service. Given we are not satisfied that we can say that competition is unlikely to be substantially lessened by the proposed merger, we must decline clearance.”

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#1724919 23-Feb-2017 09:35

From Vodafone:

Vodafone disappointed Commerce Commission declined the proposed merger with SKY

Vodafone New Zealand and Vodafone Group Plc (LSE: VOD) were today advised the New Zealand Commerce Commission declined the proposed merger of Vodafone New Zealand with SKY Network Television Ltd (ASX and NZX: SKT).

Vodafone will carefully review the Commission’s statement and consider all courses of action.

Vodafone New Zealand’s Chief Executive Officer, Russell Stanners said, “We are disappointed the Commerce Commission was unable to see the numerous benefits this merger brings to New Zealanders.”

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Jas777

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#1724920 23-Feb-2017 09:35

Forgive me for saying something that maybe stupid, but since the extra competition in the past 3+ years hasn't the cost of purchasing rights for Sports and TV shows gone up and therefore the cost to view gone up?

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MikeB4

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#1724922 23-Feb-2017 09:39

tdgeek:

MikeB4:

I am not sure I fully agree with the decision. This could well see both being sold. If they end up in equity companies hands NZ will be the worse off as they are notorious for wrecking companies.

The concern seems to be that Voda will have too much influence over non Voda users. Companies merge to share and reduce costs. Fellett has now said that he will be working with all telcos, that is a benefit.

Sky, once the Optus contract is renewed at a much lower cost, or they go via broadband instead and dump satellite, will need to restructure the business, that will reduce costs.

Until then, stick with it, no real choice.

Spark had a relationship with Sky but walked away and have declined offers since. It will be interesting going forward as Sky needs to do a lot changes to it's service delivery model to remain competitive

Here is a crazy notion, lets give peace a chance.

tdgeek

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#1724931 23-Feb-2017 09:46

Jas777:

Forgive me for saying something that maybe stupid, but since the extra competition in the past 3+ years hasn't the cost of purchasing rights for Sports and TV shows gone up and therefore the cost to view gone up?

Last year they said the rights went up a lot. This year subscriber numbers are down by a small %, revenue down by a small %, profit dropped 30 odd %, so costs have risen. Those costs arent power, wages and free lunches. It has to be rights. Thats where much blame resides. Sky or no Sky, someone will have to pay those silly fees.

tdgeek

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#1724936 23-Feb-2017 09:48

MikeB4:

tdgeek:

MikeB4:

I am not sure I fully agree with the decision. This could well see both being sold. If they end up in equity companies hands NZ will be the worse off as they are notorious for wrecking companies.

The concern seems to be that Voda will have too much influence over non Voda users. Companies merge to share and reduce costs. Fellett has now said that he will be working with all telcos, that is a benefit.

Sky, once the Optus contract is renewed at a much lower cost, or they go via broadband instead and dump satellite, will need to restructure the business, that will reduce costs.

Until then, stick with it, no real choice.

Spark had a relationship with Sky but walked away and have declined offers since. It will be interesting going forward as Sky needs to do a lot changes to it's service delivery model to remain competitive

I'm sure they will. They are rock solid financially. Doubt over Optus or not Optus, they have VOD in place if they need to use that bigly. They should remove all brick and mortar, just operate a warehouse for decoders

Pumpedd

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#1724937 23-Feb-2017 09:52

Sports seem to be the big issue for the comcom...its also a big issue for Sky with non Sky Sports subscribers subsidizing this. Maybe key national sports should go back to being broadcast free to air. Dont some major western countries have this in place?

Sky over the last 10 years has done nothing to help themselves, they have continually upset their customer base with a series of price increases and failed technology launches.

They need new leadership at the top and quickly, and to become more innovative with their plans.

MikeB4

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#1724938 23-Feb-2017 09:54

Pumpedd:

Sports seem to be the big issue for the comcom...its also a big issue for Sky with non Sky Sports subscribers subsidizing this. Maybe key national sports should go back to being broadcast free to air. Dont some major western countries have this in place?

Sky over the last 10 years has done nothing to help themselves, they have continually upset their customer base with a series of price increases and failed technology launches.

They need new leadership at the top and quickly, and to become more innovative with their plans.

I doubt the free to air channels can afford Sport.

Here is a crazy notion, lets give peace a chance.

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#1724939 23-Feb-2017 09:54

I personally think the merger between Vodafone and Sky will still happen. Sky will come up with a way of wholesaling the content which would meet the ComComs requirements.

Jas777

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#1724940 23-Feb-2017 09:56

Pumpedd:

Sports seem to be the big issue for the comcom...its also a big issue for Sky with non Sky Sports subscribers subsidizing this. Maybe key national sports should go back to being broadcast free to air. Dont some major western countries have this in place?

Sky over the last 10 years has done nothing to help themselves, they have continually upset their customer base with a series of price increases and failed technology launches.

They need new leadership at the top and quickly, and to become more innovative with their plans.

Do you want the people who are watching the sports to pay for it or do you want the Government to pay for it?

Because if they go to FTA then the taxpayer will be paying for them.

ajw

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#1724947 23-Feb-2017 10:00

Everytime these sports rights come up for contract renewal how about playing hardball at how much money is offered to secure these rights. The whole world doesn't come to an end if there is less sport on TV. Glad I'm not addicted to sports.

tdgeek

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#1724949 23-Feb-2017 10:01

Pumpedd:

Sports seem to be the big issue for the comcom...its also a big issue for Sky with non Sky Sports subscribers subsidizing this. Maybe key national sports should go back to being broadcast free to air. Dont some major western countries have this in place?

Sky over the last 10 years has done nothing to help themselves, they have continually upset their customer base with a series of price increases and failed technology launches.

They need new leadership at the top and quickly, and to become more innovative with their plans.

Remove sport subsidy, drop basic to $20 so it sits beside LB, NF, Neon Sport is $60 by itself or a bit cheaper if you get Basic or Neon

Basic is a nice option for many, and an easy entry to flick sport on and off it that a bit of a saving

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