Antitrust Authority Thwarts Bezeq-Yes Merger

Bezeq would lose motivation to provide IPTV and isnt' clear on letting rivals use its infrastructure

The Antitrust Authority refuses to allow  Bezeq (TASE: BZEQ)  to formally merge with its acquired subsidiary, the Yes satellite TV broadcast company.

The merger was part of a broad move for Bezeq to increase its stake in Yes to 58%.

Meirav Beeri, the manager of the Antitrust Authority's Economics Department and deputy commissioner, confirmed that the authority dislikes the idea, on the grounds that it could impair competition both vertically and horizontally.

The "horizontal" concern is that Bezeq should at some point provide alternative television transmissions over Internet, at some point, which would position it as competing with Yes. If the two companies merge, Bezeq might decide to eschew Internet television or IPTV, as it's called.

The Antitrust Authority looked into the possibility of other vendors (rivals to Yes) providing services using Bezeq IPTV infrastructure. But talks with Bezeq officials found deep discord over allowing unfettered access, and that did it as far as the Antitrust Authority was concerned.