Three owners CK Hutchison has come under fire for failing to use its takeover of O2 to fix the UK MVNO space.
The Phone Co-op praised the European Commission for making the right decision in blocking the deal after remedies put forward by Hutch failed to impress. CEO Vivian Woodell expressed disappointment that Hutch’s remedies did not go far enough to tackle issues in UK wholesale.
Woodell has previously said that under the right conditions, the merger could give the industry a chance to reform the UK wholesale market. Speaking to Mobile at the time, he urged Hutch not to miss the opportunity to create a more open market.
Commenting on the EC’s recent decision, Woodell said: ‘The EC was right in its assessment that the remedies proposed by H3G were inadequate. In particular they failed to address the need to open up the wholesale market and create a level playing field for market participants including MVNOs.’
Rallying for reform
The Federation of Communications Services has echoed Woodell’s call for reform. CEO Chris Pateman praised the Euro watchdog’s tough stance on the merger but said that more needs to be done. Pateman has long been a critic of the Three/O2 deal, previously accusing Hutch of attempting to lock small MVNOs out of the market.
Responding to the merger block, Pateman called for major reform to UK mobile, stating that the Three/O2 deal just scratched the surface.
‘The big issue goes far deeper than agreeing terms to merge two tentacles of what amounts to a four-armed monopoly,’ he said. ‘The mobile phone market in the UK — and indeed across the EU— needs some really fundamental reform.
‘To really drive innovation, encourage competition and deliver consumer value in mobile telephony requires the kind of wholesale competition we currently take for granted across the fixed-line networks.
‘That’s something no merger enquiry will ever deliver by itself. It requires EU-level vision and Government-level commitment to push for the rights of consumers against the vested interests of corporate providers. ‘