New Zealand Blocks Vodafone and Sky Merger

The New Zealand Commerce Commission has refused to grant clearance for a merger of Sky Network Television and Vodafone New Zealand.

The focus of the Commission’s assessment was centred on competition in both the broadband and mobile telecommunications markets. If the merger would substantially decrease competition in any market in New Zealand, the merger could not go ahead.

Chair Dr Mark Berry said the Commission outlined its concerns in a Letter of Unresolved Issues in October last year and subsequent submissions had not alleviated these concerns. Accordingly, the Commission refused to grant clearance for the merger.

Dr Berry stated that the merger would create a strong vertically integrated pay-TV and full service telecommunications provider, and this could result in more attractive offers for Sky consumers in the immediate future. However, when looking at the merger over time, and taking into account the number of Sky Sports customers, future bundled packages including Sky Sports and mobile and fibre roll-outs, the Commission had concerns that this could impact the competitiveness of the market.