The state-owned company (Racsa), which renders cable modem Internet and telecommunications services, is negotiating the acquisition of the cable TV company Cablevisión, third in the country. Racsa is a subsidiary of the state-owned telephony operator ICE, which has launched its own IPTV service in Costa Rica.
Until the Costa Rican telecommunications market was deregulated in 2011, Racsa used to be the monopolistic operator of cable modem services by means of the utilization of private cable companies’ networks like CableTica, Amnet (Tigo) and Cablevisión. When the new law allowed cable operators to offer their own Internet services, Racsa started to lose its main business and is currently amidst a strong crisis. Less than 50,000 clients remained by 2011 end out of the 120,000 cable modem users previously recorded. Since the market was opened, ICE has been investing millions of dollars in Racsa with the purpose of keeping it alive.
Racsa tried to focus on the deployment of FTTH through its partnership with the Swedish company Vía Europa, but ICE rejected the investment because its overlaps FTTx RANGE project (New Generation Open Network), with which it is also moving forward with its own IPTV. Racsa is installing fiber for its corporate services because it might also be incorporated in ICE’s network. As for the telecommunications workers’ trade union, ICE should absorb Racsa directly and unify strategies. Others consider that Racsa may focus on corporate services and ICE may focus on residential ones. But the Costa Rican Government has not moved forward with any of such options.
In the meantime, Racsa is doing its best to survive. One of its opportunities is given by the acquisition of cable operators that have also suffered the competition opening in Triple Play services. The two big MSOs, Amnet and CableTica, which account for more than the 70% of Pay-TV subscribers, have ended up benefited. But the rest of cable operators are finding difficulties to invest the necessary money. As it is the case of Cablevisión, the third cable company that records the 7% of TV subscribers, just a little below the DTH Sky Costa Rica.
“Cablevisión is selling … it is a process that started last year and Racsa is one of the most interested companies”, stated Leila Lombardi, Cablevisión manager. The company needs fresh resources for a better growth, and a partner with greater experience and strength in the Internet business, which is new for them and all small cable operators. The negotiation between Cablevisión and Racsas has been taking place for the last few months, and it has been led directly by Francesco Caldart, Cablevisión owner, and Claudio Bermúdez, ICE’s Telecommunications Manager.
