There is no doubt that UPC has found the going tough in Romania, one of the region’s most competitive marketplaces. But is it now in trouble?
If local press reports are to be believed, there will soon be changes at the highest level in UPC’s Romanian operation as the Liberty Global company seeks to regain lost ground in the country. While they cannot be confirmed, and should indeed at this stage be treated as no more than speculation, it may be instructive to take a closer look at the company’s position in Romania, past, present and future.
UPC was for a number of years a minor player in the Romanian cable industry, playing second fiddle to Astral Telecom and RCS/RDS, the undisputed market leaders. However, all this changed overnight when Liberty Global acquired Astral Telecom, catapulting UPC into the number one position.
Not long afterwards, Liberty Global also entered the DTH sector, buying a 50% stake in Focus Sat and then securing complete control of the platform.
While these were significant moves that identified Romania as a key European market for Liberty Global at a time when it was moving out of other territories (such as France and Sweden, for instance), competition in the country has since become fiercer than ever.
UPC in fact saw its cable TV subscriber total fall by 100,000 in the first nine months of last year, while its operation as a whole has really began to feel the heat from the incumbent telco Romtelecom and RCS/RDS, both of which are successful triple play companies.
However, UPC is by no means taking all this lying down. Only last month, for instance, its CEO Richard Anderson said the company is looking to buy a number of smaller cable operators. More recently, it has entered into a partnership with Orange to offer quadruple play services.
UPC may still have to sharpen up its act in Romania, but it looks certain to remain one of the country’s leading industry players for the foreseeable future.