Cable television operators will have to reapply for licences

Television cable operators will have to reapply for their licences in about two years time, under new proposals to be announced…

Television cable operators will have to reapply for their licences in about two years time, under new proposals to be announced by the Telecommunications Regulator, Ms Etain Doyle. She is also expected to signal that she believes that some of the existing illegal television deflector operators should be licensed.

The new proposals will come in a document being published shortly by the regulator's office and covering the whole area of cable television, MMDS and the advent of digital television. The new arrangements being proposed for cable licence companies could have a negative impact on the impending sale of Cablelink, the cable company jointly owned by Telecom Eireann and RTE, which has an estimated price tag of £140 million.

The other main cable operators include Cable Management Ireland and Irish Multichannel - partly owned by Princes Holdings.

The cable licences were originally issued by the Government on the basis of a seven year set-up term and were to be subject to a review two years after that.

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However, in practice this has not happened and the cable operators are likely to argue that they have invested on the basis that they will retain ownership of the licences.

They are likely to argue that certainty is essential if they are to put funds into developing new broadband services on their networks.

Close attention will be paid to what the regulator says on whether the existing operators should be favoured when the licences go for review. In addition, the cable companies will also object to any moves to license illegal operators, an issue currently the subject of litigation between them and the Government.

While the new proposals look set to lead to controversy, sources say that Ms Doyle has the power to regulate the sector independently, provided she is operating within existing legislation. However, proposals for digital television will have to fit in with Government legislation on the issue, being published shortly by the Minister for Arts, Culture and the Gaeltacht, Ms De Valera.

The Regulator is also expected to make proposals for the operation of the MMDS television system. MMDS operators were issued with 10 year licences by the then Minister, Mr Ray Burke, most of which are valid until the year 2002. He indicated that the licences were likely to be extended for a further 10 years, provided the operators had provided a satisfactory service. The Regulator is expected to indicate that she favours putting these licences up for tender at the end of the 10 years, allowing existing holders to re-apply. She is also believed to have concluded that these licences should not be exclusive.

This means that she believes that other systems, such as digital terrestrial television, should be allowed to compete in MMDS areas, which will not be welcomed by the existing MMDS franchise holders, which are also the major cable companies.