The Australian Competition and Consumer Commission (ACCC) is looking at a new round of concessions made by pay TV operator Foxtel regarding its $1.9 billion takeover bid for Austar, with reports suggesting the watchdog will approve the takeover.
Foxtel has provided the ACCC with undertakings concerning its proposed buyout, following concerns the merger would cause a lack of marketplace competition.
A report in The Australian has suggested the watchdog could clear the merger today, depending on consultation with industry experts. It was revealed recently Foxtel and Austar were willing to make concessions in order to see the deal go through.
Foxtel's concessions cover four wide-reaching areas, including the sharing of previously-exclusive channel signals and content with internet service providers (ISPs) and the extension of special access undertakings to Austar set-top boxes.
Foxtel said it will not seek to acquire or renew exclusive distribution rights to channels - including Disney Channel, SKY NEWS, ESPN, 13th Street, and KidsCo - unless another bidder is seeking exclusive rights. Foxtel is also undertaking to not acquire exclusive transactional video–on–demand rights to new release films, unless another bidder is seeking exclusive rights.
Foxtel's CEO Richard Freudenstein has stated he does believe that the merger would lead to a lack of marketplace competition, as it will result in “a parity” of access to digital entertainment services for both “metropolitan and regional Australians.”
He continued: “Foxtel’s undertakings will ensure that a broad range of content continues to be available for IPTV players. IPTV players will also be able to get access to channel signals from Foxtel so that they are more easily able to deliver channels to their customers.”
It is believed that these new concessions made by Foxtel are likely to allow the merger to go ahead.
Austar has stated it “welcomes” the ACCC's market enquiry and “remains optimistic” that a decision will be reached “in time” for their shareholder meetings on 30 March.
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