Maltanet CEO Keith Fearne, head of Maltacom’s internet service provider, has told The Malta Financial and Business Times that the merger between the two Maltacom companies Datastream, and Terranet – the company which operates Maltanet – was inevitably likely once the law would allow the return of Maltacom’s bandwidth supplier and ISP to merge back into one sole company.
Rival ISPs may have not been excited about the vertical integration of Maltacom’s bandwidth provider and subsidiary ISP, previously forced to split by competition law.
But CEO Keith Fearne yesterday said the merger had been inevitable once the legislation would have changed and allowed the island’s sole bandwidth provider – part of the legacy of the telecoms’ giant from its state-owned years – to merge back with Terranet.
“This merger was inevitable, and the only reason it did not happen before was that local legislation kept us from doing so. This legislation was not sustainable under the new EU compliant telecommunications framework, and is now no longer applicable,” Fearne said.
The ISP CEO said that “anybody who knows anything” about the industry knew that vertical consolidation of wireline and mobile set-ups had become the norm all over the world, some companies going so far as to also announce fixed to mobile convergence.
“If anybody is expecting us to sit on the fence whilst competition sets in, in a fully liberalised market, then they are in for a big surprise,” Fearne said, one week after ISP Waldonet’s managing director Aldo Camilleri said the company was hiding Terranet’s running costs through the merger.
Camilleri told this newspaper the Maltacom ISP’s operation had always been “questionable” and that ISPs who acquire their bandwidth from Maltacom’s Datastream have been subsidising Terranet “for ages”.
“We will play fairly,” Fearne said, “within the EU rules, but we will compete with everything we have got. That is the name of the game. We have hardworking employees too and we have shareholders too, and we owe this to them. But above all we owe it to our loyal customers. We have only one final objective, to continue to offer the best service to our customers.”
Fearne said the company’s consolidation was also within the framework of international regulatory frameworks. “If anyone has doubts about the way we operate, there are the legal channels both in Malta and in Brussels where they can take these up.”