Clearly, the cable industry has become the place to go if you want an easy life. At least, that’s the impression one could get from listening to Liberty Global CEO Mike Fries at this year’s Cable Congress, and from the news that Deutsche Telekom CEO Rene Obermann is set to join Dutch cable player Ziggo when he steps down from his current role at the end of the year.
It may be a facile comparison, but contrast Fries with his counterparts at Telefonica and Vodafone, based on comments they made at Mobile World Congress at the end of February: Telefonica’s Cesar Alierta took OTT players to task for not investing in the value chain, while Vodafone CEO Vittorio Colao has long expressed frustration at the level of regulation imposed on telco players in Europe.
Fries, on the other hand, noted that the cable industry is not suffering from these problems, and indeed that they have a good relationship with regulators at the EU level (though national regulators remain a little less enamored of the cable industry, particularly as regards consolidation). More tellingly, after having talked about what a great position the cable industry finds itself in, he said that the next ten years will “present issues we’ve never encountered”. Imagine Alierta or Colao saying that, and sounding like they relish the prospect?
Clearly, Colao has thought of all this, which may have something to do with Vodafone’s German operation looking at buying the country’s top cable player, Kabel Deutschland. This potential merger also highlights another point Fries made at Cable Congress, namely, the growing importance of quad-play.
“Everybody in the room needs to have a mobile strategy,” Fries said, before saying that adding a quad-play option isn’t hard to do and that he expects incumbents to start doing it. It is also clearly no coincidence that the Virgin Media purchase has given Liberty Global a subsidiary with extensive experience offering quad-play. And, based on LGI’s attempted bid for LTE spectrum in the Netherlands in December, mobile will only become more important for the company.
Between that prospect, and the news that Obermann is set to join Ziggo, it’s clear that the industry will see more and more cross-pollination between the cable, DSL and mobile sectors in the years to come. If it means looking at telcos’ and cable players’ traditional problems in a new light, then it means telco CEOs might not have to make such dramatic job changes in future.
Francesco Radicati is a research analyst for Europe at Informa Telecoms and Media. For more information, visit www.informatandm.com/