Cablevisión, Telecom Argentina Merger Promises New Leader in Telco-Content Market

Pending regulatory and shareholder approval, the combined giants will look to dominate Argentina’s telecom sector, becoming the first to offer quad-play services

Telecom Argentina, one of Argentina’s premier telecommunications service providers, has announced a merger agreement with Cablevisión, Argentina’s biggest pay TV provider accounting for 35% of Argentine pay TV households.

Cablevision shareholders will control 55% of the resulting company after Telecom issues 1.184 billion shares, leaving current Telecom shareholders controlling the other 45%.

Should the deal be waved through by regulators and shareholders, the proposed merger will allow the new company to offer quadruple-play bundled services of fixed and mobile voice and data services, internet, and video. Bundling has of course been around for years in the U.S. and Europe, but Telecom Argentina will be the first to make such an offer in Argentina. Unlike U.S. telecoms however, Telecom Argentina will also include the added benefit of mobile data in its packages, a proposition that is likely to go over well with consumers.

According to Seth Wallis-Jones, a senior analyst at IHS Markit, “the combined company will lead the market and be able to offer a fully converged quad play offering.”

The proposed merger of the companies, whose services are “complementary,” said Cablevision CEO Carlos Moltini, is one result of relaxed telecommunication regulation passed in January by Argentine president Mauricio Macri, which allows for phone companies to additionally offer TV services in a market long dominated by Cablevisión. The Argentine government predicts that the reforms will prompt more than $20 billion in new investments in Argentina over the next four years.

Almost immediately after the legislation was passed, rumors of a merger spread, given that telecom company interested in adding TV services would need to execute large scale upgrades to their network in order to broadcast. Partnering with an pre-existing network avoids that, while allowing for the expansion of services which should appeal to current and future customers.

Going forward, it seems likely that other companies in the region, such as Telefonica or Claro Video, the OTT operation of Carlos Slim’s America Movil, might well be be interested in entering Argentina’s pay TV business. Far greater investment in infrastructure also looks on the cards: While Argentina has greater broadband penetration that other Latin American countries, it still lags far behind North America and Europe in speeds and availability, particularly in rural areas. OTT can be a hard sell if the content won’t load or is of poor quality.

“Some amount of OTT competition is inevitable, but it will have a minimal impact on the traditional pay TV business,” said IHS Markit principle analyst Erik Brannon, adding that current broadband speeds are not sufficient “to deliver a significant quality in the experience.”

More TV

  • Pinewood Studios James Bond

    Netflix's Shepperton Studios Deal Is Stretching the U.K.'s Production Limits

    Netflix’s huge new hub at Shepperton Studios outside London is a further fillip for Britain’s booming production sector. Amid jitters over Brexit and its effects on the economy, the streaming giant’s commitment is a vote of confidence in the U.K. entertainment industry and a continuing source of local jobs. But the decision by Netflix to [...]

  • BBC ITV BritBox Streaming

    BritBox to Roll Out in the U.K. in Fourth Quarter

    British broadcasters the BBC and ITV have formally agreed to launch their joint streaming service, BritBox, in the U.K. in the fourth quarter of 2019. It will be priced at £5.99 per month, making it the same price as the cheapest Netflix subscription in the U.K. ITV will control BritBox, holding a 90% stake. The [...]

  • Kamala Harris

    Joe Biden and Kamala Harris Face Rematch in Next Democratic Debate

    Former Vice President Joe Biden and Senator Kamala Harris will have the opportunity to square off again in the second debate among Democratic hopefuls vying for their party’s nomination in the 2020 presidential election CNN, which will broadcast the next round of debates on July 30 and 31, televised a draw Thursday night that decided [...]

  • Jon Wax

    Jon Wax Joins Amazon Studios as Head of Genre Programming

    YouTube’s head of scripted programming Jon Wax is joining Amazon Studios as its head of genre programming, Variety has learned. Wax will take up the position recently vacated by Sharon Tal Yguado. He had joined YouTube in August 2017, heading up drama, unscripted and current programming for YouTube’s premium channel. Prior to that, he had [...]

  • South Park Donald Trump

    TV News Roundup: Comedy Central Sets 'South Park' Season 23 Premiere Date

    In today’s TV News roundup, Comedy Central announces the premiere date of “South Park” Season 23 and Netflix sets the premiere date and offers a first look at “Unbelievable.”  DATES Comedy Central announced that Season 23 of “South Park” will premiere Wednesday, Sept. 25 at 10 p.m. Because the episodes are written and animated so [...]

  • US actor Kevin Spacey (C) is

    Kevin Spacey Shouldn't Be Exonerated in Hollywood Even as Criminal Case Ends (Column)

    The news that criminal charges against Kevin Spacey in the Nantucket groping case have been dropped raises an inevitable question: does this mean he can claw his way back into Hollywood’s good graces? Or maybe more importantly: should it?  Spacey’s rapid descent was startling, even as it quickly followed that of the once untouchable producing [...]

More From Our Brands

Access exclusive content