Virgin Media is poised to step in as a rival if Three takes over O2

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Virgin Media today threw its hat into the ring as the potential fourth force in the UK mobile phone market if Hutchison’s Three were to be allowed to complete its £10.5 billion takeover of O2.

The bid is in front of the EU’s competition commissioner Margrethe Vestager, who has sent Hutchison a so-called statement of objections running to several hundred pages. 

She and regulator Ofcom’s Sharon White have expressed worries over any reduction of mobile operators in the UK.

Yesterday Three’s chairman Canning Fok made several pledges including a five-year price freeze,  £5 billion of investment and opening Three and O2’s networks to other “meaningful competitors”.

Tom Mockridge, chief executive of Virgin Media, said Virgin already had experience in mobilesand could provide serious extra competition.

“Any competition concerns can be addressed without blocking the proposed O2-Three transaction,”  he said. 

“The commission has previously cleared mobile mergers which resulted in a reduction in the number of mobile operators from four to three, subject to wholesale remedies.   In two of these cases, Austria and Ireland, Virgin Media’s parent company Liberty Global provides vigorous competition and consumer choice as a result of taking EU remedies.”

Virgin said it would not rule anything in or out and would await a final outcome from Brussels before deciding. But if it were to acquire network capacity from a merged Three/O2 it would be the first time it has owned any part of the network in the UK since Sir Richard Branson launched Virgin Mobile as the world’s first virtual operator in 1999.

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February 6, 2016 |
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