From "EuroTelco morning spam" - Wednesday 22nd September, 2004
More consolidation news
Tele2 has this morning issued a bid for Scandinavian broadband provider Song Networks, at a price of SEK75 per share, or 7% higher than what TDC offered just last week. Tele2 claims to have identified SEK300m in annual cost synergies achievable by year-end 2006. Song Networks' assets would give Tele2 access to 1.3m households (150 PoPs) in Sweden and a sizeable DSL network in Denmark (91 PoPs), Finland (179 PoPs) and Norway (112 PoPs). Also, it will put Tele2 within reach of around 75% of all companies with more than 10 employees in the Nordic region, and elevate Tele2 to the number two position in the IP-VPN market, after TeliaSonera. This is a pretty significant upshift in Tele2's competitive position in the Nordic region, and probably most affects TeliaSonera, at least initially.
Buried in an obscure corner of today's Financial Times (page 4, News Digest, for readers of the UK edition) is an item reporting that the French Culture Minister is to attend meetings with UK super-mega regulator OFCOM today in London to discuss the UK experience in promoting digital TV penetration. France targets a penetration rate of 85% by 2007, according to the article, and one wouldn't need to be a fly on the wall in the meeting to guess that the role played by Freeview in the UK's success story will be an area of intense interest for the French, particularly given their pioneering work with Minitel. As we recently highlighted, Freeview continues to drive growth in digital TV penetration in the UK market, to the detriment of other platforms, most notably Sky. Application of a similar model in France would seem to pose some longer term threats to established and new pay TV initiatives in the market. At the sharp end of competitive pressure arising from such a move: Vivendi Universal, owners of satellite platform CanalPlus, as well as Cegetel, which is active in the TV-over-DSL arena; France Telecom; UnitedGlobalCom and the newco combining the cable assets of Vivendi and France Telecom; and DSL unbundlers including Iliad, Neuf and Tiscali.