Orange/ T-Mobile Merger Under Threat

A mobile industry deal long assumed to be a mere matter of formal paperwork despite threats from all corners of the industry, the proposed merger between UK mobile companies Orange and T-Mobile seems to be under serious threat. Other mobile networks have long been complaining that the merger will produce the UK’s largest mobile phone company, and restrict competition in the market, as well as increasing the overall cost to consumers. The two companies are currently ranked third and fourth in terms of subscribers in the UK, behind Vodafone and O2, but a recent successful campaign to have the merger examined in the UK – under local regulations – has foiled the companies attempts to restrict the examination to the less strict EU regulations.

Major concerns seem to revolve around the smallest national network, ‘3’, who it’s thought would suffer most from the merger. If 3 were to go out of business following a merger, this would leave only three large companies competing for business and could lead to a lack of options and limited price variety within the UK. 3 is currently heavily reliant on T-Mobile, who provide their network coverage, and many observers are worried that if T-Mobile becomes part of Orange, they may no longer consider their networking agreement with 3 to be a priority.

Another concern is the mobile network spectrum, which – if Orange and T-Mobile combine – will play very much into the amalgamated companies hands. It’s thought that the government is concerned about the dominant position this will put the company in, and may even resort to simply using the threat of a competition commission enquiry to take back some of the airwaves, as opposed to actually carrying out the enquiry. Many of these issues, of course, relate to the increased data transfer required for 3G services, as well as the antiquated style in which the airwaves have been allocated in the UK, something the current government has recently been treating as a major issue, and attempting to alter.

Share and Enjoy:
  • Print this article!
  • Digg
  • Facebook
  • Google Bookmarks
  • E-mail this story to a friend!

Leave a Comment

Previous post: New Release: The Sony Ericsson Aspen

Next post: Vodafone Pushing For UK iPad Sales Role