The International MVNOx Association criticised the stance Vaizey took in his speech in Parliament accusing the minister of not seeing the true value of mobile spectrum and failing to address the consolidation in the mobile market properly.
Vaizey was responding to questions from Mobile at the TechUK Spectrum Policy Forum this morning [16/12/2015]. He also took the opportunity to reject the notion that he was ‘in the pocket’ of mobile operators, he said: 'I thought the comments were slightly barmy, I don't really get the point they were making. I told Parliament that the mobile operators should be praised and this somehow meant that I am a minister in the pocket of the mobile operators.
'I explained that these private companies are investing their own money and that when we complain about mobile coverage we should remember they are building it with their own capital.
'The iMVNOx Association comments were slightly over the top. It is valid for the MVNO sector to participate in these debates as there are concerns about how that industry will develop in the future, with all the consolidation in the market, but they could have raised these concerns in a more sophisticated fashion'
iMVNOx responds to Vaizey’s ‘barmy’ remarks
Mobile took Vaizey’s comments back to iMVNOx who responded to them by warning the minister that by not addressing the issues connected to consolidation fully there was a real risk of the market becoming less competitive, as Frankie Spagnolo, founder and director of iMVNOx explained: ‘The point we’re trying to make is that it is not alright to congratulate the operators for doing what they signed up to do. Patting the MNOs on the back for spending shareholder and consumer money, turns a blind eye to the inherent risk associated with enabling MNOs to merge to gain economies of scale and dominate much wider ranges of spectrum; that of reduced consumer choice, leading to rising prices.
‘They may be “private companies making private investment”, but that investment will be paid back by the consumer. After all, the business case behind the investment in the first place.
‘Without a competitive and effective and sustainable wholesale market, instigated by the CMA on the back of the BT/EE merger, regulated by Ofcom, and supported by the Minister, it will be harder for MVNOs to exist. We have made this clear to the CMA, but it appears to have fallen on deaf ears. Despite the fact that MNOs regularly cite MVNOs as competition when it suits them, such as in the case of consolidation, in reality they seek and mostly succeed to manage this competition and control the market according to their own needs.‘
This is not the first time that Vaizey and the iMVNOx have clashed, the Association wrote to Vaizey in November asking him to take action over the BT/EE merger.
In its response to the Association’s letter the DCMS refused to enter the debate, referring the organisation to the Competition and Markets Authority and Ofcom.