Cable TV firm Cablevision has merged with Telecom Argentina, creating the largest provider of telecom and media services in the country.
The merger will pose a threat to the dominance of America Movil’s Claro, the biggest operator with more than 37% of the market share.
The combined entity will operate under the brand of Telecom Argentina, but Cablevision will own a controlling stake (55%), according to a joint statement issued by the firms.
The companies will reportedly pool their resources to build a high-speed fiber optic network to provide pay-TV and broadband services. They are also discussing the possibility of cross-selling their services to each other’s clients.
The combined company will offer quadruple play, combining fixed line, cell services, pay television, and broadband internet access in a single package, according to Telecom Argentina’s CEO German Vidal.
With 31% market share, Telecom Argentina is the third largest telecom carrier in the country. It began seriously scouting for a partner in the pay-TV market when President Mauricio Macri issued a decree allowing phone companies to offer pay television services.
However, in order to deliver television, it needed to improve its network cables, say analysts.
The merger comes just as the Argentinean government devises plans to reform the telecom sector as part of its bid to foster competition and reduce the price of ICT services.
Likely to be implemented fully in January 2018, the new reforms are expected to bring in US$20 billion over the next four years.