In This Article:
Vodafone and Three have vowed to fix Britain’s mobile “not-spots” as regulators gave the green light to their £15bn merger.
The Competition and Markets Authority (CMA) on Thursday approved the tie-up, which will create the UK’s largest mobile network with 27m customers and reduce the number of operators from four to three.
Vodafone and Three said they would invest £11bn over the next decade to upgrade sluggish download speeds and end the “frustration” felt by many customers. The UK currently ranks 22nd out of 25 for 5G in Europe.
Bosses said at least 7m customers will see an instant improvement in network speeds and enjoy more reliable, consistent connections because of the merger.
They added that a quarter of so-called “not spots” – where people struggle to get a good signal on their phone – will be eliminated from day one, while more than 2m fewer customers will experience network congestion.
Margherita Della Valle, chief executive of Vodafone, said: “[The UK] needs better mobile infrastructure with wider coverage, faster speeds and better quality connections.
“We will remove the frustrations that have held back the country for too long.”
Robert Finnegan, chief executive of Three, added: “The UK doesn’t have the quality of mobile networks that a country of its size and stature deserves.
“We’re lagging way behind not just the US but the rest of Europe in terms of where we rank from a mobile quality infrastructure point of view. From today, that changes.”
The CMA previously warned that the merger could lead to higher prices for consumers and harm mobile virtual network operators (MVNO) – such as Sky Mobile, Lyca, Lebara and iD Mobile – which piggyback off larger rivals’ networks.
However, it said it would accept the deal if the two companies made a legally binding commitment to make significant infrastructure investments over the next eight years.
Both Ofcom and the CMA will oversee the investment commitment, with the merged company required to publish an annual report setting out its progress.
Vodafone and Three, which is owned by Hong Kong-based CK Hutchison, have also pledged to retain certain tariffs and data plans for at least three years and committed to pre-agreed prices and contract terms to ensure MVNOs can secure competitive wholesale deals.
Stuart McIntosh, chair of the independent inquiry group leading the investigation, said: “It’s crucial this merger doesn’t harm competition, which is why we’ve spent time considering how it could impact the telecoms market.
“Having carefully considered the evidence, as well as the extensive feedback we have received, we believe the merger is likely to boost competition in the UK mobile sector and should be allowed to proceed – but only if Vodafone and Three agree to implement our proposed measures.”