RIGA — Internet and cable TV providers Baltkom and Izzi are attempting to merge in order to compete with Lattelecom, but first they need to ask permission from the competition council.
The Latvian companies are intending to lump their expertise and infrastructure together so they can compete in what they say is a monopolized market. Lattelecom, which is partly state owned, is alleged to be too big a player in the market.
Baltkom announced to Latvian newswire Nozare.lv that both companies had already lodged their applications with the competition council.
“The goal of the merger is to improve the service provided over the united territory of the two companies, as well as concentrate the companies’ resources on the development of the existing services, the introduction of modern technology, and the creation of real competition in the telecommunications market, which is currently dominated by Lattelecom,” Baltkom spokesman Lauris Kļaviņš said.
The two companies specialize in different fields, but believe they could be a real force when combined. Infrastructure and existing umbrella companies would be able to operate together if the merger goes ahead.
Lattelecom’s chairman of the board Juris Gulbis told the Baltic News Service that the company would become too much of a power in the market.
“Competitors have so far cultivated a misleading picture of the Lattelecom monopoly in order to create their own – if the merger of two large industry players Izzi and Baltkom went ahead, the television services market would develop a dominant position,” Gulbis said.
He denies the monopoly tag and says the market functions currently.
“So far, the television services market works with an equally large number of players who compete with each other. If they create one which is much larger, it will be able to dictate the price,” Gulbis said.
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