The Competition and Markets Authority has proposed a way forward for a Vodafone and Three merger in the UK market.
In a statement released today the UK competition watchdog said that it had provisionally approved the merger provided certain conditions were met.
These included the delivery of their joint network plan, which would involve an eight-year investment programme to upgrade the merged company’s communications and connectivity infrastructure across the UK – including an ambitious 5G rollout programme.
This investment is combined with some short-term customer safeguards including a commitment to respect existing customer tariffs for a three-year period.
The regulator also said upholding pre-agreed deals or prices with Mobile Virtual Network Operators such as Sky Mobile, Lyca and Lebara could protect consumers and wholesale customers alike.
Last year the CMA expressed concern that the merger would result in “a lessening of competition in the UK” for both the retail and wholesale mobile markets. However, the regulator now appears more convinced that the long-term benefits outweigh a potential increase in mobile prices.
Stuart McIntosh, chair of the inquiry group leading the investigation, said: “Our provisional view is that binding commitments combined with short-term protections for consumers and wholesale providers would address our concerns while preserving the benefits of this merger.
“A legally binding network commitment would boost competition in the longer term and the additional measures would protect consumers and wholesale customers while the network upgrades are being rolled out.”
Vodafone and Three first announced plans to merge in June 2023 in a deal that would potentially create a mobile network giant serving over 29 million customers. The move was seen as a response to BT’s 2016 purchase of EE, and the 2021 merger of Virgin Media and O2.
CMA said that its provisional decision will be made final before the 7 December statutory deadline, following feedback on today’s announcement.
