The Executive Branch authorized the three largest cable TV companies in that country, Montecable, Nuevo Siglo and TCC, to operate in a consortium the provision of television service for subscribers and data transmission in Montevideo, according to the resolution signed by President Luis Lacalle Pou.
The Board of Directors of the Communication Services Regulatory Unit (Ursec), with votes from the ruling party, had already given its approval, both in matters of defense of competition and regulation of the telecommunications market. Ursec maintains that the formation of a consortium "does not constitute a concentration operation because pay TV and streaming are part of the same relevant market". This same line of argument is included in the text of the official resolution.
The decision of the three companies, which are owned by Canal 10 (TCC), Canal 12 (Nuevo Siglo) and Canal 4 (Montecable), occurs in a context of transformation of the cable operator market, which has been suffering a sharp drop in users in in recent years, as a result of the growth of streaming services: last year the market lost 77 thousand customers, 13% of the total.
According to the entity, the relevant market for paid television services in the country reaches a universe of almost 500 thousand users, so much so that this merger would only affect 19%, that is, about 94,200 subscribers. Furthermore, in the case of data transmission, "the proposal would configure an incoming competitor in said market, without links with operators that already operate in it," the Ursec document highlighted.Today TCC has 19% of the capital's cable clients, Nuevosiglo 18% and Montecable 16%. The other market players are Flow (23%), Directv (19%) and Multicanal (5%).