Conservative investment climate favours cable and DTH, says Resource Partners

Cable, DTH and infrastructure-based operators are still the best investment opportunities in the sector, according to Piotr Nocen, founder and managing partner, Resource Partners. “Definitely people will still be interested in companies with visibility of cashflow,” said Nocen, speaking at Informa’s Digital TV CEE conference in Krakow this morning. This would favour large or dominant operators with established subscriber bases, he said.

Deals are still happening, but the private equity and strategic investors that are doing them are more selective, looking for fixed assets, real cashflow and proven business models, said Nocen. However, the IPO market has dried up and there are unlikely to be many signficant public flotations except possibly for privatisation of government-owned assets, said Nocen.

There are likely to be more acquisitions of cable firms by mobile operators similar to the model of Vodafone buying Kabel Deutschland, Nocen said. Organic growth in mobile is limited without bundling.

IPTV services based on a significantly different business model such as video-on-demand only businesses and mobile TV are still in search of a business case, said Nocen, and are less attractive for investors.

Nocen said that the TV advertising market has not expanded, but there has been a shift in emphasis away from mainstream broadcasters and traditoinal media towards thematic channels and OTT operators.