The ACCC has ruled that Telstra can proceed with its acquisition of a majority share of Fetch TV, determining that the move wouldn’t give Telstra the ability and incentive to foreclose competing broadband retailer’s access to Fetch.
Fetch TV is currently 95% owned by entities associated with Astro Overseas Limited, with the remaining 5% held by current and former Fetch TV employees. With Telstra’s 51.4% acquired interest in Fetch TV, Astro Overseas Limited will hold the remaining 48.6% interest.
Telstra and Fetch TV both supply content aggregation services through set-top-boxes. Telstra supplies Telstra TV with eligible Telstra retail broadband services and Fetch TV supplies set-top-boxes to broadband retailers to supply as an add-on to broadband services, and directly to consumers through select retail stores.
ACCC Commissioner, Liza Carver, said: “Our investigation found that entertainment offerings are one important way for broadband retailers to differentiate themselves from competitors.
“However, Fetch TV does not appear to be critical or a ‘must have’ aspect for Telstra’s retail broadband competitors to offer consumers a competitive retail broadband service.
“With this in mind, it is unlikely the proposed transaction would lead to Telstra foreclosing rival broadband providers.”
Another factor in the decision to allow the move to go ahead was the fact that several broadband retailers, including those that offer Fetch TV, also supply other entertainment offerings or other inclusions.
“Less than 10 per cent of retail broadband customers in Australia acquire Fetch TV services from their retailer and there are a growing number of ways in which consumers access and consume entertainment content, including through smart TVs without the use of a Set-top-Box,” said Carver.
The ACCC also considered the overlap between Telstra TV, Fetch TV and Foxtel, which is 35% owned by Telstra.
The ACCC concluded that Telstra TV, Fetch TV and Foxtel would continue to face competition from other technologies and differentiated services such as smart TV’s and hardware devices.
Carver: “While Telstra is the largest broadband retailer in Australia, we have carefully examined the facts and circumstances of this acquisition as well as changes in the way consumers access entertainment.
“We have concluded that this acquisition is unlikely to result in a substantial lessening of competition."
Fetch TV is an Australian internet protocol television provider and offers a set-top-box that allows customers to rent and purchase movies, watch free-to-air television channels and access a number of linear pay television channels through subscription packages.
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