O2, Three and 5G Future

[Cleoriff]

Yesterday the news broke that the merger of Three and O2 had been blocked by the EU

(discussed here) http://community.o2.co.uk/t5/Off-topic/O2-Three-Merger-Has-Been-Blocked/m-p/971211

The decision to block the merger has been criticised by many even though the UK's communications regulator Ofcom, had argued that allowing the number of players in the market to fall from four to three would inevitably lead to higher prices, poorer service or both.

There is much discussion about the way BT and EE were allowed to merge The reason it was not blocked was apparently because BT was not really a player in mobile. But its rivals point out that the combined firms now have control of 40% of mobile airwaves and the lion's share of the UK's fixed broadband infrastructure

Concerns are also raised in this article about the future of 5G. Europe has lost it's lead in this development

http://www.bbc.co.uk/news/technology-36267740

[viridis]

The next few month will be defining time in UK mobile networks future.
Whoever gets o2, Will be looking to advance beyond BT having such a stronghold.

[Cleoriff]

It does seem the European Commission felt the merger would have hampered the rollout of 5G...,,I just wonder why they didn't have the same concerns with  BT and EE joining forces. ...or is it more 'political' than that?

Surely a bigger company would have more reason and funds to invest in 5G...?

[gmarkj]

I think it goes back to the idea that 3 networks is less competitive than 4, particularly when it comes to spreading the bandwidth about.
If there are 2 much larger networks (BT/EE and o2/3), then they could bully the smaller network (Voda) and get more share of the available spectrum.
This then puts a strain on the smaller network capacity (more customers using less space) leading to slow downs and people becoming unsatisfied with their service, which in turn leads to moving to another network which means the smaller network gets smaller, etc, etc...

[Bambino]

A lot seems to have been said about the EU commission blocking the merger, but some forget that Ofcom was opposed to it as well, and personally, I think the right choice was made. It now leaves the door open for Liberty Global/Virgin Media to step in. I think this would be a good thing, not just for O2 customers, but for everyone, as Liberty Global are the only company with the ability to fight BT on more than one front, at least in areas that are cabled up.

I also think that this veiled 'threat' of the networks not having enough money for 5G is a load of bull. When the phone manufacturers start making 5G capable phones, and the auction for the spectrum becomes available, whoever is in the game will climb on board. No network is going to want to be left behind.

[Cleoriff]

I understand that @gmarkj though I did read (ages ago now) that Vodafone and Virgin were actually in favour of the O2/EE merger? Needless to say I can no longer find that article...only this one about Virgin and the forum mentions Vodafone http://forums.theregister.co.uk/forum/1/2016/02/05/virgin_gives_its_blessing_to_o2three_merger/

[Bambino]

I don't know when that Register article was written @Cleoriff, but the comments are all from three months ago. It will be interesting to see what Virgin and Vodafone say now. Both have remained conspicuously quiet.

[gmarkj]

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@Cleoriff wrote:

I understand that @gmarkj though I did read (ages ago now) that Vodafone and Virgin were actually in favour of the O2/EE merger? Needless to say I can no longer find that article...only this one about Virgin and the forum mentions Vodafone http://forums.theregister.co.uk/forum/1/2016/02/05/virgin_gives_its_blessing_to_o2three_merger/

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Yeah, just found that (and the article) as well as this piece from the Telegraph:

http://www.telegraph.co.uk/business/2016/03/11/virgin-media-signals-mobile-ambitions-in-three-o2-fal...

Interestingly enough the Telegraph piece says that Liberty were looking at an acquisition/merger with Vodafone. If they are now looking at o2 instead it is a bit of a turnaround and suggests that o2 is a better option...

[Cleoriff]

@gmarkj That did make interesting reading...particularly as you say Liberty/Virgin were looking to link up with Vodafone. Considering that was published in March...I thought this part was an eye opener also ...

"However, it is understood that if competition watchdogs insist there must be four network owners, Hutchison has indicated it could sell O2’s masts and a small chunk of spectrum. Virgin Media would then be likely to face a heavy investment in more radio spectrum due for sale by Ofcom, to ensure it has enough capacity to compete"

Just makes you wonder 'who is going to jump into bed with who'?

[MI5]

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@gmarkj wrote:

Interestingly enough the Telegraph piece says that Liberty were looking at an acquisition/merger with Vodafone. 

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Yes, I said yesterday on @Bambino 's thread that I thought I had remembered reading about that.

I couldn't remember where though