Horizontal Integration | Another Mega-Merger in Mobile Telecoms?

BT merged with EE. O2 merged with Virgin Media. Now Vodofone and Three are also in merger talks.

Details of the merger talks are reported here in the Guardian.

If permitted by the competition regulators, the combination of the third and fourth largest mobile phone networks respectively will combine to create a business with 27 million customers, larger than current leaders BT, EE and Virgin Media O2.

The companies are claiming that it will speed up the rollout of the 5G network and improve broadband connectivity.

However, the merger is inevitably going to be subject to close scrutiny from the the Competition and Markets Authority (CMA), not least with concerns about the impact of less choice on the price of mobile deals during a cost of living crisis.

A joint venture might be the result of their discussions rather than a fully-fledged merger and integration of the two businesses.