The proposed £15 billion merger between telecom heavyweights Vodafone and Three has taken a further step towards go ahead, according to the UK’s Competition and Markets Authority (CMA).
On 5th November, the CMA announced that the merger could actually bring some major perks for customers, provided Vodafone and Three stick to their promise of pouring billions into network upgrades across the UK, including the roll out of more 5G coverage.
Back in September, the CMA raised eyebrows with a preliminary report that flagged potential risks: higher prices and a rougher road ahead for smaller mobile networks like Sky Mobile, Lyca, Lebara, and iD Mobile, which rely on wholesale deals. To tackle these issues, the CMA sought input on possible fixes, known as “remedies.”
They have now unveiled a Remedies Working Paper to gather feedback on these proposals. The CMA is suggesting that, if Vodafone and Three commit to legally binding investments and network improvements, it could actually make the UK’s mobile market more competitive in the long run, while enhancing services for millions of users.
Still, the CMA sees a need for some short-term protections to make sure customers and smaller mobile providers can continue to access affordable options as the network upgrades get underway.
Under the proposed remedies, Vodafone and Three would have to:
- Deliver on their network upgrade plan – This means significant investment in upgrading and expanding the network over the next eight years across the UK, with regulatory oversight from both Ofcom and the CMA to keep them on track.
- Hold the line on prices – They’d need to keep certain mobile tariffs and data plans stable for at least three years, protecting customers from any quick price hikes as the new network plan rolls out.
- Offer fair deals to smaller operators – Vodafone and Three would commit to competitive, pre-set wholesale prices and contract terms so smaller mobile providers can continue offering their customers good deals.
In a nutshell, the CMA is looking to strike a balance that allows the merger to go ahead while putting protections in place so that the market stays fair and competitive. It’s all about keeping options open and prices fair for everyone who depends on mobile services.
