Spains Legal Ops Get Own Trade Group

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Madrid, Spain -- The dividing line in Spain between
licensed and unlicensed cable operators is now more defined with the recent creation of
the Cable Operators Association trade group, which will admit only licensed cable
operators.

Spain's other two cable associations, AESDICA and
Espacable, have less stringent standards.

The five founding partners of the COA are investor groups
CyC Telecomunicaciones, Supercable, Retecal, Grupo Cable and Telecable. They have won
cable licenses covering 3 million households.

"By the end of the year, when the last licenses have
been finally awarded and other companies join [the] COA, we expect that figure to increase
to more than 5 million" households, said a COA spokesman.

Spanish electric utilities Union Fenosa and Endesa, as well
as Italian telco Stet, are investors in COA-member companies, effectively making them part
of the trade group. The same holds true for Spanish telephone company Retevision,
Argentine MSO Supercanal de Cable and several small Spanish cable operators.

Cableuropa, one of Spain's biggest MSOs, is not a
member of the COA. A source at the company said there hasn't been any official
discussion about joining the group, declining to say why.

Backers of the COA said the group will help to legitimize
the Spanish cable industry and facilitate negotiations with programming and equipment
suppliers.

"The aim of [the] COA is to represent the interests of
the members regarding national and international administrations, and to deal with
technical equipment and programming-providers," said a source at the COA. "The
association will coordinate negotiations with providers of telecom equipment and
programming, which will be good both for cable operators and providers."

People who follow the industry believe that the COA will be
the strongest association and the one with the most credibility among Spain's three
pay TV trade groups.

"[The] COA will be the association of the
future," said Luis Campo, general manager of program-provider Cable Antena.

To Eduardo Zulueta, general manager of program-provider
Multicanal, "The creation of this association is a very positive move toward
gathering cable operators, and it will help to develop the cable market much
further."

On the other hand, AESDICA, which represents Spain's
cable pioneers, is trying to help its members to stay competitive. Espacable is a newer
trade group that represents the smallest cable operators.

Both associations are trying to protect their members from
having to close down as larger cable operators gain more power. Experts forecast that
AESDICA's members will have more of a chance to survive than Espacable's.

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