BT recently announced its intention to buy mobile provider EE for £12.5bn, and there are rumours of Three buying O2. What followed was an intense debate about mergers.
Florriebunda started off the discussion with some thought-provoking questions:
‘From past experience mega takeovers are not good news for consumers. One concern is that all the contestants in these mergers had poor reputations at one time or another.
‘Will mergers result in mega problems for consumers? […] Small is beautiful perhaps?’
Dennis C agrees that small is beautiful:
‘If this take-over is successful in my opinion it will be too large and give them an almost a monopoly which is not to the good of the consumers.’
Competition in the mobile market
This was then echoed by Joan, who seems more worried about the potential merger between O2 with Three:
‘I’ve been with O2 for several years and have been satisfied with their service, though it’s not as good as it was. Bigger usually means worse so I will probably move to a different provider if the merger goes through – not many left to choose from though, which is the point.’
And that’s why Legacymjr thinks this is a good reason to have a deeper look at the market:
‘I think that with fewer players there may be an opportunity for Ofcom to address the real problem with mobile and that is the truly appalling patchy coverage on all networks […] I am always amazed that I get a far better signal in the Pyrenees and in rural Spain than in parts of central and west London, and loss of signal on the M4 between Reading and London on average 3/4 times during a journey.’
When we put these mergers to a vote, a resounding 94% of you felt that the regulators should look into competition in the mobile and broadband markets. And only a quarter of 16,000 Which? campaign supporters felt there was enough competition in the mobile and broadband markets.
Will it be alright on the night?
NFH took a balanced view on the news:
‘I’m not concerned about BT buying EE. After all, BT sold O2 to Telefónica, so it’s perfectly reasonable for BT to buy a mobile network again. However, I am very concerned about the potential takeover by Three of O2. This is bad for competition, as it would reduce the number of mobile networks from four to three.’
Whatever your opinion on the mergers, I think we can all appreciate John Ward’s metaphor:
‘Looking at the behaviours of big corporations, the mind is drawn to the appearance of lava lamps. They are a constantly changing fusion of blobs that expand and collapse as they evolve and reform due to the conflicting properties of their contents (and the stimulation of a heat source – competition in this analogy).’
We think that competition authorities should look at both the proposed mergers and the market in the round to make sure that you’re protected from unfair price increases or poorer service as a result of less competition.
Are you concerned about these mergers? Do you think they will have a negative impact on consumers?