In the UK, T-Mobile and Orange To Merge

EthanV2 sends in BBC coverage of the merger plans of Orange and T-Mobile in the UK. "T-Mobile and Orange plan to merge their UK businesses, creating a mobile phone giant with 28.4 million customers. If completed, a deal between Deutsche Telekom's T-Mobile and Orange owner France Telecom would see a firm with sales of €9.4 B (£7.0 B, $13.4 B). It would be the UK's largest provider, overtaking Telefonica's O2, with about 37% of the mobile market. ... However, it is likely that competition authorities in the UK and EU will probe the deal."

Re:Monopoly?

[Anonymous Coward]

Supposedly the new company would have around 37% of the market, which sounds daft given that there are only 60 million people in the UK. What this doesn't account for is the number of people who have both personal mobiles and mobiles supplied by their employers, eg for on-call purposes.

O2 have around 28% and Vodafone 25%, so there isn't that much in it. The issue the regulators seem to have is that the UK market will go from five major (O2, Vodafone, Orange, T-Mobile and 3) players to four, and the merged Orange/T-Mobile would have a very large retail presence as well.

There are a couple of virtual providers out there as well. IIRC Virgin use the T-Mobile network, so this merger may have an impact on them.

Re:Monopoly?

[mrsmiggs]

In 2007 we had 71 million handsets [guardian.co.uk] in the UK and the BBC think that the combined company would have 37% market share [bbc.co.uk]. It doesn't look like this would be classed as a monopoly however we could be well on our way to a cartel with only O2 and Vodafone in position to be competitive with the new merged company and 3 basically tied to the new company because of their extensive Network sharing with T-Mobile [theregister.co.uk].

Both the EU and UK (Competition Commission and/or Ofcom) regulators will be paying a great deal of attention to the merger, given the high barriers of entry to the market place (i.e. it's not really possible) and the low number of competitors.

Re:Monopoly?

[Johnny2225]

As MVNOs they have contacts with the operators, virgin with tmobile and tesco with O2 but any change in ownership would allow the respective MVNOs to get out of the contract and use a different network, so i doubt there would be much difference in price in the short time. Although the register mentions in the article this maybe a reason why they have decided to do a 50 : 50 merger so the change in ownership clause does not become an issue.

Re:Monopoly?

[Anonymous Coward]

I'm pretty sure that anything over 25% would legally be a monopoly in the UK (I know technically it's not a monopoly, but in a rare case of foresight the monopoplies and mergers laws took into account that 25%+ is enough to distort a market).

Re:Monopoly?

[Splab]

The barrier isn't that high as long as the EU keeps doing what it's been doing. MVNO (Mobile Virtual Network Operators) is the new thing, this has already taken off in Denmark for instance, it's fairly cheap to start up and due to regulations you aren't being bled dry by the actual owner of the network. It is however fairly new and quite a few kinks has to be ironed out.

Re:Monopoly?

[jonbryce]

If you read the summary, it is about 37% of the market. There are more cellphones than people in the UK. Pretty much everyone has a cellphone, and a lot of people have more than one - eg work cellphone and personal cellphone.

Re:Mergers

[VJ42]

However, it is likely that competition authorities in the UK and EU will probe the deal.

Is there ever any news of mergers that hit Slashdot that aren't probed by the EU?

It tends not to be news if two tiny companies merge to form another small company; that happens all the time without regulators getting involved, it's just not important enough to hit the/. front page.

Re:German Tmobile and "France" Tcom?

[sznupi]

T-mobile also, although the market seems to resist the efforts of German high command at rebranding, so it still functions under the name "Era" (plus fully dependant prepaid network "Heyah")

Re:Monopoly?

[jonbryce]

There aren't going to be any more spectrum auctions for a while. Three got in by bidding in the last auction, and they aren't exactly that new to the market. Hutchison Wampoa, the Chinese company that owns Three was the original owner of Orange.

Re:Google phone to Orange?

[FireFury03]

Seconded. I moved from Orange to T-Mobile, despite the fact I was largely happy with the Orange service, to get the G1.

I moved from Orange to Three when I got my HTC Dream because Orange's data price structure is totally uncompetitive with pretty much any of the other MNOs....