Three UK has notified the European Commission (EC) of its competition concerns over the proposed ‘UK mCommerce joint venture’, the proposed mobile marketing and services platform set up by its rivals O2, Vodafone and Everything Everywhere. The deal is still subject to competition clearance.
The operators announced the plan to create the mCommerce joint venture on 16 June 2011. Three was not invited to be part of the joint venture. The aim is to bring together the expertise and technology of the three operators onto an open platform to accelerate the development and delivery of new mobile marketing and payment services.
It will provide a one-stop shop for advertisers, marketing partners, retailers and banks to book advertising space, create campaigns, provide offers, coupons and loyalty cards to be held on mobiles and redeemed in shops.
Mobile understands that the joint venture has yet to make a formal application to the European Commission for its platform, although it has had talks. It is not yet clear how the mCommerce joint venture model will work or how it will be structured. Three has therefore made an informal representation to the EC outlining its concerns.
Three UK's regulatory affairs director Stephen Lerner said: ‘The planned and explicit exclusion of Three from the proposed UK mCommerce joint venture is designed to weaken Three’s ability to be a competitive force in the UK and denies the initiative’s claimed ambition to be a ‘One-stop shop’ for mCommerce.
‘Instead of competing for the benefit of consumers, the three operators that hold 90% of the UK market have engaged in a cosy collaboration and closed ranks against competition. The Competition authorities in Brussels should not allow this type collaboration to go forward under any circumstances.
‘As the UK’s 3G pioneer Three’s track record of innovation in internet mobile services is clear. Excluding the maverick raises serious competition concerns. It has serious implications for both consumers and wider business as the internet continues to move mobile.
‘The Commission allowed last year’s consolidation in UK mobile, but kept a watching brief on further threats to consumer choice and competition in the UK.
‘We’re asking the Commission to take a clear view of what is at stake for consumers and the dangerous precedent this move could set across Europe for the incumbents to freeze out challengers.’
As with other industry issues, such as MTRs and aspects of the proposed 800MHz and 2.6GHz spectrum auction, it would appear Three believes the other operators are pursuing courses that potentially make it more difficult for it to compete with them on a level playing field.
It will be up to the EC to decide whether the UK eCommerce joint venture is anti-competitive or not. If it rules that it is anti-competitive, a decision will have to be reached as to whether Three should be allowed to join it as an equal partner, or whether the venture should not be allowed to go ahead at all.