Vodafone-Three Merger Faces Competition Scrutiny

Britain's competition regulator, CMA, has raised concerns over Vodafone's $19 billion merger with Three UK, which could reduce the number of mobile networks from four to three and potentially increase customers' bills. However, the deal may also improve network quality and expedite 5G deployment. Final decisions will be made in December.

Britain's competition regulator has raised concerns over Vodafone's $19 billion merger with Three UK, which could lead to higher bills for millions of customers by reducing the number of mobile networks from four to three. However, the Competition and Markets Authority (CMA) noted the merger might enhance network quality and speed up the deployment of next-generation 5G technology.

Announced 15 months ago, the merger between Vodafone and Three UK, owned by Hong Kong's CK Hutchison, challenges the regulator's stance that maintaining four networks is essential for keeping prices low. The companies argue the merger would create a stronger third player capable of competing with market leaders BT's EE and Virgin Media O2.

The CMA will consider how Vodafone and Three might address its concerns about the merger's impact on retail and wholesale customers while securing its potential long-term benefits, including future network investments, according to CMA inquiry chair Stuart McIntosh. The companies expressed their willingness to collaborate with the CMA to gain approval, with possible remedies including commitments on network investment and customer protections.

(With inputs from agencies.)