London [UK], December 6: Britain on Thursday approved Vodafone's, opens new tab $19 billion merger with Hutchison's, opens new tab Three UK to create the country's biggest mobile operator after their investment promises outweighed concerns about higher customer bills.
The Competition and Markets Authority said the combined group's network investment plan would drive competition in the long term, dropping its objection that a move from four to three networks could push up prices.
Britain has some of the slowest mobile speeds in Europe and its new Labour government has told regulators to favour any deal or policy that would increase investment and lift economic growth.
Operators across Europe have argued that regulators' focus on low prices has hurt investment and left its digital infrastructure trailing the United States and Asia, hampering the continent's economies.
The four-to-three mergers that were allowed required the creation of challenger brands to keep prices low. The CMA's approval on Thursday marks the first time a major European market has allowed such a deal without structural remedies.
Instead, Vodafone and Three, Britain's third and fourth operators respectively, committed to spend 11 billion pounds ($14 billion) on a 5G network that would serve 50 million customers, including the subscribers of Vodafone's network sharing partner Virgin Media O2.
It also sold spectrum to VM O2, pledged to cap some tariffs and agreed to set contract terms for mobile virtual operators.
The CMA accepted that three stronger operators - Vodafone-Three, current market leader BT, opens new tab and VM O2 (TEF.MC), opens new tab - would provide enough competition to deliver a better service for customers.
Source: Fijian Broadcasting Corporation
