Regulators approve SFR takeover of Tele2 business

EU regulators approved French mobile phone operator SFR to buy Tele2 AB's French fixed-line telephone and broadband unit, after SFR and its parent Vivendi promised to stay away from exclusive Internet broadcast rights to blockbuster films and to offer content to rivals, an Associated Press report said.

SFR is jointly controlled by French media conglomerate Vivendi and British telecom company Vodafone. Vivendi also owns the leading French pay-TV network Canal Plus and has a small stake in Hollywood's Universal Studios.

The Associated Press report said the European Commission initially said Vivendi's control over 'attractive' film and TV content led it to believe the deal would cause problems by combining two direct rivals for Internet services and businesses involved in the same supply chain for broadcast rights.

To eliminate antitrust concerns, Vivendi and SFR have promised not to buy exclusive video-on-demand rights to recent US and French films, the report said.

The deal would originally have given SFR/Tele2 exclusive or privileged access to this content, the report said.
But regulators were worried that other high-speed Internet operators who are the main rivals to Canal Plus would not be able to stop Vivendi blocking rights to must-see TV.

Vivendi will now allow those operators distribution rights to all channels and channel packages offered to SFR at normal market conditions that cannot be undercut by SFR, the report further said.