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Bulgaria’s CPC Approves United Group’s Bulsatcom Acquisition Amid Market Dominance Concerns

By  |  February 18, 2024
Bulgaria

Bulgaria’s Commission for Protection of Competition (CPC) has greenlit the acquisition of local satellite TV and internet provider Bulsatcom by United Group, the parent company of Vivacom, a major player in Bulgaria’s telecommunications sector. The decision, disclosed by various Bulgarian media outlets earlier this month, was made public with a heavily-redacted ruling posted on the regulator’s website late on February 16.

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    The move has stirred debate, particularly among Vivacom’s competitors, Yettel Bulgaria and A1 Bulgaria, who voiced concerns that the acquisition would grant Vivacom a commanding market share exceeding 50 percent in the TV services segment.

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    According to data from Bulgaria’s Communications Regulation Commission (CRC), as of 2022, Vivacom and Bulsatcom collectively accounted for over 60 percent of total TV service subscribers, positioning them as the leading providers in the country. Yettel Bulgaria and A1 Bulgaria, while offering similar services, hold considerably smaller market shares.

    However, in its ruling, the CPC contested the validity of CRC’s data, arguing that it failed to consider key factors such as subscribers of streaming platforms like Netflix and users of TV and satellite services from neighboring countries like Greece and Turkey, which are accessible in certain parts of Bulgaria.

    The CPC asserted that the total TV services subscription market in Bulgaria should be measured at around 2.5 million subscribers, significantly higher than the two million figure indicated by the latest CRC report. With this adjusted baseline, the combined market share of Vivacom and Bulsatcom falls below the critical 50 percent threshold, according to the competition regulator.

    The decision underscores the evolving landscape of Bulgaria’s telecommunications sector, where traditional metrics of market dominance are being reevaluated against the backdrop of changing consumer behaviors and technological advancements. While the acquisition clears a significant regulatory hurdle for United Group, it also highlights the importance of comprehensive market analysis in assessing competition dynamics in an increasingly interconnected digital environment.

    The approval from CPC comes with conditions aimed at safeguarding competition and consumer interests, signaling the regulator’s commitment to ensuring a level playing field in Bulgaria’s telecommunications market. Nonetheless, the decision is likely to spark further scrutiny and debate as stakeholders assess its implications for the industry’s future trajectory.

    Source: Sofia Globe