Tuesday, October 24, 2006

Leaky pipes

An awful lot of money has been put into the Dutch cable business lately by Cinven and Warburg Pincus, most recently the Essent transaction for EUR2.6bn. Given the fiber incursions from municipal governments, housing corporations, and Dik Wessels' phalanx of companies (as well as KPN's own plans), I have been somewhat taken aback by some of the per-subscriber valuations generated in these transactions. It will come as little comfort to the Dutch cable industry when, as predicted by the front page article in today's Trouw, the Dutch parliament votes later today to regulate cable on an equal basis with KPN - imposing an obligation to unbundle access for third party services, and, I assume, bringing in price controls.

UPDATE: The vote was unanimous, in favor, across all 14 parties!

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