Tens of millions of UK mobile phone customers could see their costs frozen for the next five years, as CK Hutchison tries to sway competition watchdogs over Three’s merger with O2.
As Three’s parent company, Hutchison has pledged a #5bn investment to ease concerns over its proposed takeover of O2. Together, the two would create the UK’s largest mobile network, with some 40 per cent of the market, and reduce the number of telco players in the country from four to three.
This has sparked competition fears that the merger would send prices skyhigh and investment plunging, and both EU and UK watchdogs are probing the deal. On Monday, Ofcom chief Sharon White asked Europe regulators to block the deal.
Now, Hong Kong-based Hutchison is promising not only a five-year price freeze, but also to open its network to competitors.
Experts remained unswayed, however, with a uSwitch analyst remarking that Hutchison was “trying to get ahead of the game”:
“Even taking Hutchison's three promises into account, there is a real risk this merger could stifle innovation and competition, reduce the incentive for networks to undercut each other, and lead to less innovative propositions,” said Ernest Doku, telecoms expert at uSwitch.