Orange merger with T-Mobile challenged by consumer champs
Orange and T-Mobile haven't had an easy year and now some paper-pushing killjoys are attempting to ruin it completely. The proposed merger of the two telecom companies is being challenged by Consumer Focus and the Communications Consumer Panel (who they?) who suspect the deal will be fast-tracked without the impact on British consumers taken into account.
The parent companies of both Orange and T-Mobile (France Télécom and Deutsche Telekom) generate two thirds of their revenue outside the UK, so the merger is likely to be investigated by a European commission - that'll occur far quicker than any review by the Office of Fair Trading (OFT) and Competition Commission. The mainland bureaucrats can choose to "repatriate" the investigation to the British authorities, which is what the consumer champs are hoping for.
Why stand in the way of the merger? Amongst the reasons, the Consumer Focus and the Communications Consumer Panel believe:
- reducing competition in the market will hamper the expansion of 3G network coverage
- smaller service operators will be lost (in the case of 3, we don't think there'll be many tears shed by Bitterwallet readers if that happened)
- the new company would control a particular part of the mobile phone spectrum, which could hinder the government's rollout of broadband services across the UK
- the merger may affect virtual network operators such as Tesco Mobile and Virgin Mobile, who lease capacity from the service providers
From the point of view of Orange and T-Mobile, this is something that has to happen as far as their UK interests are concerned. T-Mobile is about as popular as a brass cloud and neither it or Orange will come close to challenging market leader O2 without merging with one another.
TOPICS: Consumer Advice