Voo inks deal with cable operators

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BRUSSELS -- Belgium's Voo consortium has become the sole cable distributor in Belgium's French-speaking regions after clinching a 464.5 million euro ($678 million) deal with eight smaller operators.

The deal, which also ends a long legal and administrative saga, means that Voo can create a triple-play giant in Wallonia, the southern, French-speaking half of Belgium.

"This is an important day for the audiovisual sector, because from now on there will only be one operator for the while of Wallonia," Walloon Economic Minister Jean-Claude Marcourt said.

The eight cable operators were all jointly owned by local councils and utility company Electrabel, itself part of France's Suez energy giant.

Voo is a joint operation set up in April 2006 by Brussels-based cable operator Brutele and ALE-Teledis, based around Belgium's second city, Liege. Voo aims to provide cable and digital television, Internet and telephony down the same line, although it will require a network upgrade to two-way digital hybrid fiber coaxial to bring a higher bandwidth to users.

The consortium was hurriedly thrown together when other rivals emerged to challenge in the Belgian triple play market: Belgacom TV -- backed by former national telephone company Belgacom -- and Telenet in Flanders.

ALE and Brutele still have to merge their cable operations -- they currently have not much more than the Voo brand name -- and the hasty initial agreement between them was unable to deter a legal challenge from Telenet earlier in 2007.

Telenet filed a suit when it was sidelined last year from the bidding negotiations for the eight operators, and it attempted to block the deal: The Flemish company claimed it was excluded as it is part of John Malone's Liberty Global empire. However, though Telenet's legal battle has been dropped, there are still questions about whether Voo can meet the triple-play expectations in Wallonia.

Cable has a 90% penetration rate in Belgium, and both Belgacom and Telenet have attempted to extend their reach into Wallonia without success. In 2004, Luxembourg operator Altice made a 196 million euro ($262 million) failed bid for the eight networks.
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