New Blow Dealt on Bulgarian Cable Operator in TV War

Business | January 16, 2013, Wednesday // 11:38|  views

The TV channel TV+, whose offices were raided by police one week ago, has also lost the rights to air the games from the group A football championship. File photo

Bulgarian Cable Operator Bulsatcom has been dealt a heavy blow by losing the rights to air the games from the group A football championship.

The TV channels TV+ and Film+, broadcast mainly by Bulsatcom, have lost these rights at the end of December, but the information had been just confirmed with a letter sent by Football Pro Media, the company owning the rights on the tournament.

The letter, notifying the operator that it is losing the exclusive airing rights, cites as grounds failure to adhere to the clauses of the contract.

The TV+ and Film+ channels are widely-linked to Bulsatcom. Even though it is common knowledge, Bulsatcom deny ownership the two channels because it is actually illegal in Bulgaria to be both a cable operator and media owner.

In the latest developments, the State-owned Bulgarian National Television, BNT, will keep its rights to a second choice of a game at each round of the championship.

TV7 is said to be the favorite in acquiring broadcast rights for it, even though Football Pro Media is naming only BNT as a possible future partner. They further say there will be a tender and TV+ would be allowed to bid.

"Football Pro Media" was created in the fall when the games were not aired live. Its main shareholders are Kiril Domuschiev and Todor Batkov owners, respectively, of the Ludogorets and Levski Football Clubs.

The latest development means that Bulsatcom customers would not be able to watch the games from the Bulgarian championship.

The war between major cable provider Bulsatcom and two top TV channels has been going on since December 2012.

On January 12, TV7 took off its channels from Bulsatcom on grounds of the failure of the 2-week-long negotiations and Bulsatcom bullying TV7.

TV7 advised its viewers to switch to honest cable operators in order to be able to enjoy its programs.

On January 2, Bulgaria's largest private TV network, bTV, took off once again its channels from the cable provider.

The grounds were breach of contract on the part of Bulsatcom by failing to pay dues and quoting a lower than real number of users to reduce fees. The dispute is not settled at the moment and the outcome remains unclear.

The TV first stopped airing its programs for Bulsatcom customers on December 22, but reinstated the transmission two days later, all while stressing this was a temporary measure, just so that viewers can still enjoy the programs during the holidays.

Negotiations failed in the last work day in Bulgaria for 2012 – December 28. bTV insists the cable operator owes them money, while Bulsatcom firmly rejects the claim.

bTV was followed by TV7, which declared they would not be renewing their contract with Bulsatcom on the same grounds. Later, TV7 also decided that it was more important for them to not deprive viewers from their programs around the holidays and continued the broadcast.

Bulsatcom received support from the 21-member Bulgarian Association of Cable Communication Operators (BACCO), which on December 31 announced it will have to suspend bTV and TV7 from their programs, as their actions constituted a cessation of contract.

The Association also added that bTV's new requirements could result in cable operators being forced to up prices for end users. Representatives of the Association of Telecom Users have argued that the move by bTV and TV7 aims at diverting users from Bulsatcom to Vivacom. However, Vivacom is also a BACCO member.

The Users' Association stated that it had already sent Commissioner Nellie Kroes a letter regarding what they called a "dishonest trade practice" on the part of the TV channels.

In response, bTV also sent a letter of complaint to the European Commission over what it saw as "unfair actions" on part of Bulsatcom.

Currently, bTV and TV7 can be seen non-cable with an antenna and life online.

Bulsatcom promised to assist their customers with installing non-cable antennas. The operator has also started to transmit some new programs and is negotiating to add others.

One week ago, economic police stormed the office of TV+. According to reports of the Interior Ministry and the prosecution, the police were searching the premises and conducting an investigation related to tax evasion.

One of the prosecutors in the case explained the probe has been launched on the tipoff sent by a TV+ journalist, informing employees were made to sign contracts for the minimum monthly wage, paid as direct deposit, while the rest of the salary was given to them in cash.

This is a wide-spread practice in Bulgaria, leading to losses in taxes and insurance for the State coffers.

Bulsatcom scored a significant win in the battle last Friday when it was awarded a mobile operator license by the country's Communications Regulation Commission.

On Monday, the Association of Bulgarian Radio and TV Operators, ABRO, also accused Bulsatcom of hiding anywhere between 26% to over 64% of the real number of their customers and of having a monopoly position with its 35% share of the market.

ABRO cited independent studies of EstablishmentSurvey, conducted in October 2012. The Association further stressed that while in Europe and the US, cable and satellite operators slate 50% of their profits for TV programs, in Bulgaria this share was 20%, meaning it is preventing and would prevent in the future the creation of Bulgarian TV programs.

The country's Commission for Communications Regulations called on all sides for a constructive dialogue on behalf of Bulgarian consumers, and reminded it did not have the authority to interfere in their contractual relations.

In another development, the "MusicAuthor company accused Tuesday bTV Media Group in owing them over BGN 2.5 M in fees, something the later firmly denied, stressing Bulsatcom was the largest debtor.

"MusicAuthor" is a copy right company.

Meanwhile, the war brought down prices for cable and digital TV in Bulgaria with competitors of the cable operator offering new packages in an attempt to attract bTV and TV7 fans as customers.

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Tags: mobile operator, Bulsatcom, European Commission, EC, Vivacom, EU, Nellie Kroes, TV, Bulsatcom, TV7, bTV, bacco, cable, satellite operator, GSM, mobile operator, Bulsatcom, Kiril Domuschiev, Todor Batkov, Football Pro Media, MusicAuthor, group A football championship, games, air, rights, BNT, ABRO, Commission for Communications Regulations, GSM, satellite operator, economic police


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