Princes Holdings and its US shareholder TCI are promising heavy investment in upgrading their TV relay network to provide a range of telephone and multi-media services to consumers.
TCI confirmed yesterday that it had acquired Cable Management Ireland (CMI), another cable TV company, and this network will now be managed in tandem with Princes Holdings.
TCI owns 50 per cent of Princes Holdings, with Independent News and Media holding the remainder.
While TCI has purchased CMI, it will be managed by the Princes Holdings management team under managing director Mr Bart Bonsil.
The combined Princes and CMI network has around 220,000 customers, making it the second major player in the Irish market alongside NTL. Around 130,000 of its subscribers have cable and 90,000 are on the MMDS network.
Princes Holdings' customer base is concentrated in Cork and Limerick, while the CMI customer base is mainly in north Dublin and in the fast-growing counties of Wicklow, Kildare and Meath.
Independent News and Media has not contributed financially to the acquisition and is believed to be focusing its cash resources on overseas expansion, as well as on its new print plant. It will hope, however, to benefit from Princes being part of a larger network and will receive management fees for its management contribution to overseeing TCI's CMI network.
Princes has already committed to invest between £100 million and £150 million (€127.1 million and €191 million) to upgrade its existing network, and the overall level of investment is now expected to rise further.
According to Mr Bonsil, the plan is to introduce a national telecoms company that will provide digital TV, discounted telephony and high-speed Internet access, with the CMI network giving the scope to attack the Dublin market.
Mr Ray Doyle, CMI's managing director since shortly after the company's foundation in 1989, said the combination of the two companies would help to achieve a consolidation of the industry and support the delivery of broadband services to a wide customer base.
Under Mr Doyle's management, CMI has been one of the first cable companies in the world to deliver full multi-media services to consumers by upgrading its network in the Swords/Malahide area of north Co Dublin.
Princes and TCI will have to spend heavily to bring the entire cable network to this standard. Princes is also hoping to win one of the local loop licences now being auctioned by the telecoms regulator, Ms Etain Doyle, which would allow them to provide a similar range of services on the MMDS network.
The acquisition of CMI by TCI and its integration with Princes Holdings creates a second major player in the Irish market, following NTL's acquisition of Cablelink and its 350,000 customers. NTL is known to have been actively interested in CMI, but may have had its attention distracted by a major move in the UK, where it bought the Cable & Wireless TV network.
TCI has acquired CMI through Liberty Media, a subsidiary which is the holder of the Princes shares. It is the second-largest cable company in the world, with interests in the US, the UK, Japan and South America.
