On the eve of the Spanish government's announcement on the winners of two new nationwide, free-to-air digital terrestrial television (DTT) licences, the country's private TV union has sent out a strong warning that the market will not be able to sustain the increase in competition.

The Union of Associated Commercial Television Broadcasters (UTECA) - grouping Antena 3 Television (backed by Telefonica), Telecinco and Sogecable (owner of Spanish pay outlet Canal Plus) - released a statement suggesting that the fragmentation of advertising revenues and audiences will jeopardise the financial viability of all the networks.

As one solution, the Union called on the government to reduce, if not prohibit, advertising on public broadcaster Television Espanola and regional public networks, a practice long disputed within the industry.

The government is expected to announce the licence winners on Friday. The entrance of two new TV players will have a radical effect on Spain's market. Backers of operating channels - which include powerful media congloms Telefonica and Sogecable/Prisa - were barred from competing.

Five consortia - each encompassing at least one key content provider - are competing for the new licenses. They include:

  • Horizonte Digital, a largely Catalan consortium led by Grupo Godo (publisher of La Vanguardia newspaper) and Swedish firm Centrum Elektronisk, with a reduced participation by Media Park and the backers of the Planeta publishing and audiovisual group, Corporacion Accionarial Lara;
  • Veo Television, backed by Recoletos and publishing firm Unedisa (El Mundo newspaper);
  • Net TV, spearheaded by publisher Prensa Espanola (ABC newspaper), Pantalla Digital (producers Grupo Arbol/Globomedia and Telson/Cartel), producer Europroducciones, and international TV partners from France (TFI) and Portugal (SIC);
  • Cope, backed by Church-backed Radio Popular Cope;
  • and Telecomunicaciones Comver, a new consortium led by Swedish broadcasting group SBS.