1/8/2010 1:04:00 PM
Rivals call for OFT to investigate T-Orange merger
The Orange/T-Mobile merger is facing delays after rival operators
3, Vodafone and O2 called for the Office of Fair Trading to investigate the deal.
The news comes as
Orange and T-Mobile prepare to register the merger for the approval of
the European Commission. Their UK rivals argue that the proposed
merger must be investigated by UK authorities as well as the European
Commission to protect the interests of UK consumers.
are also concerned that any merger will result in the new entity owning
a disproportionate and uncompetitive amount of 1800 MHz spectrum.
3 spokesman said: 'This planned merger should be reviewed in the UK.
It is a merger between two UK companies and will have a significant
impact on the UK mobile market.'
He said that the allocation of
spectrum could impact on current network sharing agrements, adding: 'A
concentration of 1800 MHz spectrum in the hands of one entity will
distort the development of a competitive mobile broadband market in the
short and medium term. The combined entity should be required to
release a significant amount of 1800 MHz spectrum to address this
also pitched in this week. An O2 spokeswoman said: 'The proposed merger
of Orange and T-Mobile and the resulting concentration of 1800 MHz
spectrum will distort the market for fourth generation LTE services. It
is a significant competition issue with serious implications for UK
consumers, the Government’s Digital Britain agenda, and future spectrum
auctions. We therefore believe the Office of Fair Trading should
request for the merger to be reviewed in the UK .'
Vodafone also called for a UK-based investigation into the merger. A spokeswoman said: 'The UK operators' spectrum holdings need careful review to ensure that competition is safeguarded and we believe that the UK authorities are best placed to investigate this.'
Analysts said the
operators' opposition was not surprising. Eddie Murphy, analyst at
Priory Consulting, said the merger would drive 'a coach and horses'
through the original spectral agreement.' He added: 'The other
operators must be very concerned as the competitive environment was
originally set up with a spectrum allocation reflecting the existence of
five players in the market, so if two operators now merge into one it
will give that merged entity a significant spectral advantage.'