Three, O2, the wood and the trees

Added by Chris Pateman | Wednesday 11th May 2016

So EU Commissioner Margrethe Vestager and her Competition team have decided reducing the number of UK mobile network operators from four to three would work to the detriment of consumers and inhibit competition. 

Well, that's great as far as it goes. Though, strangely, I somehow find myself reminded of the Hungarian politician who coined the phrase that under the Warsaw Pact, his country was the 'happiest barracks in the concentration camp'.

We are pleased to see the EU has taken such a strong line on this merger.  Hutchison’s proposed ‘remedies’ amounted to little more than a licence to re-arrange the deckchairs.  They fell well short of what is needed to genuinely encourage innovation on anybody’s terms but the incumbent operators’. 

But the big issue goes far deeper than whether or not to merge two tentacles of a four-armed monopoly.  The mobile phone market in the UK — and indeed across the EU— needs some really fundamental reform.  The kind of reform which, sadly, sits beyond Commissioner Vestager's remit.

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 the giant MNO providers.  

The EU has tinkered at the edges with its welcome roaming commitments and price caps.  But it’s competition, not bureaucracy, which will deliver sustainable consumer choice.

True, a post-Brexit UK would be able to address this in a far shorter time-frame than would be possible EU-wide. But only if there was the political will to do so.  And preferably to do so in such a way as not to unintentionally advantage BT/EE ahead of the other MNOs. Alas, we see no sign whatever of any policy-maker showing the least willingness to address that particular elephant. 

Tags : Hutchison DG Competition | Permalink