Telcos free of pay-TV restrictions after president signs law

14 Sep 2011

A law lifting restrictions on telecoms network operators providing pay-TV including cable TV services has been signed by Brazil’s president Dilma Rousseff. In August the Senate approved the legislation allowing locally-owned telecoms operators and foreign-owned companies to offer subscription services including cable TV. The new law would raise the current 49% cap of foreign ownership of cablecos, whilst freeing traditional telcos from restrictions on offering TV services over their own networks. The move is seen as levelling the playing field in a market where pay-TV operators have long been free to offer bundled telephony and internet access under one integrated company. Another expected effect of the law is that Mexico’s America Movil will exercise an option to take control of the voting shares of Brazil’s leading cableco by subscribers, Net Servicos.

Earlier this month France-based group Vivendi confirmed a plan for its Brazilian telco subsidiary GVT to launch satellite-based pay-TV by October. Meanwhile, pay-TV operators face increased competition from internet-based services, with the news this month that US-based on-demand and online streaming video provider Netflix had launched commercial services in Brazil.

Brazil, America Movil (AM)