Alternate telecom provider OTEnet Cyprus, a subsidiary of the Greek telecom giant has filed an official complaint with the Competition Directorate General of the European Commission regarding CyTA’s deal with LTV.
OTEnet charges CyTA of abusing its dominant market position and attempting to kill off competition in the promising and lucrative DSL market following its content agreement deal with LTV, the company that currently holds the broadcast rights to Cyprus, UK, European football and other sports as well as deals with prime movie studios.
According to the deal reached between CyTA and LTV, the latter will provide its extensive content through CyTA’s miVision digital platform, which OTEnet views as uncompetitive, since the joining of the two giants will essentially close the market to newcomers.
OTEnet CEO Anthony Voscarides had told the Financial Mirror that his company had no other choice and despite substantial cost to appeal to Brussels to block the deal based on the argument that in his view the CyTA/LTV is exclusive and it also involves huge financial subsidisation of LTV by CyTA.
He pointed to a clause in the deal according to which CyTA subsidiary Digimed would acquire a 25% stake in the share capital of LTV and reports that CyTA will purchase LTV bonds valued at CYP 10 mln.
In the initial stages, CyTA also has agreed to pay LTV an annual fee for its content amounting to some CYP 5.5 mln spread over three years after which the two sides hope to cover their costs by sharing the revenue.
CyTA Chairman Stavros Kremmos dismissed the OTEnet complaint arguing that miVision is open to cooperation deals with everybody. He said miVision, currently has 8000 subscribers and needs content to increase its numbers.
“We have content agreement deals with more than 30 providers, why are those okay, but the deal with LTV is not,” asked Kremmos.
He added that he was hopeful that deal would be finalised in the next few days, noting that the decision of the House Competition Committee was the main element holding back the deal.
“If all goes well, then television viewers could well see the launch of the venture by this coming August.”
