Industry backlash begins over BT/EE takeover decisions

Industry backlash begins over BT/EE takeover decisions

The Federation of Communication Services has issued a rallying cry to those in the industry with an interest in the BT/EE merger to come forward in response to the preliminary decision taken by the Competition and Markets Authority (CMA) last week to approve the deal.


BT’s £12.5bn takeover of EE approved

The industry body’s CEO Chris Pateman told Mobile that the CMA’s decision had shocked him: ‘I am perplexed, it’s bizarre that something that everyone in the industry is so worried about has not been considered a competition concern. We were not expecting this result; we weren’t expecting 100% of what the members wanted, but we were expected more than this. We’ll have to make a powerful case to get it changed.

CMA approves BT/EE merger

‘The FCS warned the CMA at the outset that if it allowed the investigation to proceed along existing market definitions such as the 2003 Comms Act and the 2002 EU Directive, it would risk drawing conclusions based on yesterday’s markets, rather than tomorrow’s.
‘I can't blame it, I suppose, for taking the approach it did. But having done so, we believe the conclusions at which it has arrived significantly fail to address the present and future needs of the market.

Voicing concerns over merger

Vodafone ‘disapppointed’ by BT/EE meger approval

‘The CMA acknowledges this is a complex market, and that it's extremely difficult for it to second-guess the future. Which is why it has extended the inquiry for a further eight weeks, so it can assess responses to its initial report. FCS and our colleagues in IMVNOx, the MVNO association, are already preparing to respond.  But we urge everybody in the industry who has an interest in the future to respond also. Let the CMA – and your local MP – know your concerns.’

TalkTalk joins Voda in BT/EE merger concerns

The FCS joins Vodafone and TalkTalk in questioning the decision by the CMA, with the former stating that the deal would have a ‘negative impact on the market’. A spokesperson for the network said: ‘Overall, we are disappointed to read these initial findings by the CMA.  

Negative impact on the market

‘Although we agree with the CMA’s finding that the UK wholesale mobile market is and will remain very competitive, we strongly believe the combination of the UK’s dominant supplier of digital fixed infrastructure, upon which all other providers rely, with the largest mobile operator, would have a negative impact on the market and the services available to millions of UK consumers and businesses.’

Shadow communications minister Chi Onwurah took to Twitter to express her fears over the merger approval: ‘So UK's largest broadband provider (BT) buying our largest mobile provider (EE) raises no competition concerns???’

Greater political engagement is something that the FCS would welcome, with the organisation raising the possibility that Parliament become involved in the decision-making process.

Pateman explained: ‘As things go forward, I also wonder what appetite or precedent there might be for Parliament to “call in” the CMA findings, much as it does with contentious planning applications.’  
Responding to the issues raised, a CMA spokesperson said: ‘It’s a provisional decision so we are inviting responses from all interested parties. We will consider all these carefully before we reach a final decision.’

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