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Three predicted to buy O2 in 2014


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Old 15-11-2013, 13:13
japaul
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It's that time of the year when CCS Insight do their annual predictions for the years ahead and this year they reckon Three will buy O2 UK in 2014. They also reckon Orange and Deutsche Telekom will merge by 2015 which would unify EE's ownership.
http://www.mobilenewscwp.co.uk/2013/...uy-o2-in-2014/


Here's CCS's previous predictions from last year
http://www.fiercewireless.com/europe...ond/2012-11-30

and from 2011
http://www.ccsinsight.com/press/comp...012-and-beyond
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Old 15-11-2013, 14:27
qasdfdsaq
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Ahahahahahah HAHAHhah HAH hah HAH!

Is what I say to all their previously incorrect predictions.
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Old 15-11-2013, 14:33
jabbamk1
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I don't see this happening either.
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Old 15-11-2013, 14:44
enapace
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Well I would love for this to happen and it is certainly a possibility with Three looking to expand it's European telecoms portfolio. I can't honestly see it happening will certainly change the European market if it did though.

Three would become leaders in three countries.

Spain
UK
Germany (If merger goes through)

And have a good foothold in quite a few other European countries.
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Old 15-11-2013, 15:30
qasdfdsaq
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Potentially it means they'll end up sharing the MBNL network with EE and the Cornerstone network with Sodafone given them the ultimate in UK coverage.

Because that'll ever happen.
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Old 15-11-2013, 17:44
rocketronnie75
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It's that time of the year when CCS Insight do their annual predictions for the years ahead and this year they reckon Three will buy O2 UK in 2014. They also reckon Orange and Deutsche Telekom will merge by 2015 which would unify EE's ownership.
http://www.mobilenewscwp.co.uk/2013/...uy-o2-in-2014/


Here's CCS's previous predictions from last year
http://www.fiercewireless.com/europe...ond/2012-11-30

and from 2011
http://www.ccsinsight.com/press/comp...012-and-beyond
I'm predicting O2 to buy three
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Old 15-11-2013, 17:46
Zee_Bukhari
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I'm predicting O2 to buy three
they can't afford it. And it'll never be allowed to happen. MBNL will not allow it.

O2's track record is shocking, they will crumble the network like they have with their own rotting network.
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Old 15-11-2013, 17:54
Thine Wonk
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I'm predicting O2 to buy three
Well that won't happen, Telefonica are $50BN in debt and have been disposing of assets like O2 Ireland to Hutchison Whampoa (Three's owners), they also sold or sold parts of O2 Germany, O2 Czech republic, Latin American businesses, Attento, China Unicom and many others.

Hutchison Whampoa (Three's owners) are looking to buy "debt encumbered European telecoms companies" as part of their strategy and are currently selling prized assets in Hong Kong in order to raise 20BN to enable that.

Telefonica is Europe's most indebted telecoms company.
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Old 15-11-2013, 18:49
RAN Man
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they can't afford it. And it'll never be allowed to happen. MBNL will not allow it.

O2's track record is shocking, they will crumble the network like they have with their own rotting network.
Nothing to do with MBNL.

Pretty improbable that it would be allowed for competition reasons as OFCOM have always stated that you need a minimum of 4 networks for a competitive market.
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Old 15-11-2013, 18:58
neil79
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Got to love O2
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Old 15-11-2013, 19:31
drivel
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Don't forget how deep pocket the owner of Three has.

This is possible, if Telefonica wants to sell.
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Old 15-11-2013, 19:40
qasdfdsaq
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Nothing to do with MBNL.

Pretty improbable that it would be allowed for competition reasons as OFCOM have always stated that you need a minimum of 4 networks for a competitive market.
4 networks or 4 operators? We already don't have 4 networks.
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Old 15-11-2013, 19:41
Thine Wonk
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Don't forget how deep pocket the owner of Three has.

This is possible, if Telefonica wants to sell.
The chairman is Asia's richest man, but aside from the personal wealth, the company is actively clearing Asian assets to raise over 20BN as they seen an opportunity to be European phone companies from debt laden companies.

Ofcom will allow 4 'companies', Three's takeover of O2 Ireland is going through despite the fact they already network share with Vodafone Ireland. The only way the UK network can consolidate as has happened in other European countries is Hutchison taking O2 off debt laden Telefonica's hands, solving Telefonica's debt problems.

Vodafone UK isn't up for merger or sale as it's their home market, EE is already consolidated and too big for further merger or consolidation - wouldn't get past the regular. Three is not for sale as Hutchison want to buy in Europe, not sell, that leaves only 1 option for consolidation of the UK market, and that is Hutchison doing what they did in Ireland and owning O2 UK and Ireland.
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Old 15-11-2013, 20:36
DevonBloke
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Sweet! Three would then have the biggest chunk of 800Mhz.

I might get a decent mobile broadband service to replace my crappy ADSL with after all !

It might even be "superfast" and would work indoors upstairs since 900Mhz does.
Just think, I might not have to blu-tack a smartphone to a window either.. Hahahahaha
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Old 15-11-2013, 20:44
andersonsonson
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o2 are crap, sorry
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Old 15-11-2013, 20:53
DevonBloke
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That was constructive! Hahahahaha
To be fair, their 2G voice network, coverage wise is probably the best of the lot, but apparently with crap call quality.
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Old 15-11-2013, 21:09
RAN Man
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4 networks or 4 operators? We already don't have 4 networks.
We have 4 networks, albeit consolidating onto 2 site grids. That will not make it 2 networks.
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Old 15-11-2013, 21:13
enapace
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We have 4 networks, albeit consolidating onto 2 site grids. That will not make it 2 networks.
Which is another reason why I don't think Three and O2 will merge because of this site sharing. Though theoretically it is entirely possible it could continue as MBNL is 2G & 4G 1800MHz and 3G 2100MHz where as Cornerstone is 4G 800MHz and 2G & 3G 900MHz. So there isn't a massive crossover but if it did happen it would be an interesting how that would work.
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Old 15-11-2013, 21:29
qasdfdsaq
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Too much awesomeness in one network is how that would work.
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Old 15-11-2013, 21:36
mogzyboy
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Why would Three want to buy O2 UK anyway? After purchasing the business, they'd have to spend a fortune on upgrading all that crap infrastructure that has seemingly not been touched since the 90s!
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Old 15-11-2013, 21:56
Thine Wonk
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Which is another reason why I don't think Three and O2 will merge because of this site sharing. Though theoretically it is entirely possible it could continue as MBNL is 2G & 4G 1800MHz and 3G 2100MHz where as Cornerstone is 4G 800MHz and 2G & 3G 900MHz. So there isn't a massive crossover but if it did happen it would be an interesting how that would work.
O2 Ireland has been acquired by Three, despite Three already having an MBNL style network share in place with Vodafone Ireland.
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Old 15-11-2013, 22:06
enapace
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Why would Three want to buy O2 UK anyway? After purchasing the business, they'd have to spend a fortune on upgrading all that crap infrastructure that has seemingly not been touched since the 90s!
Quite simple and I would think obvious additional 800MHz spectrum for 4G and 2G & 3G 900MHz for legacy coverage. Giving them the best portfolio of long range and indoor penetration spectrum. It would also give them an additional 2x10MHz of 2100MHz which they could either convert to use with 4G or use for capacity on 3G. All they would need then is get some 2.3GHz in the upcoming auction to give themselves a brilliant spectrum portfolio for 2G & 3G & 4G. Also the fact they would have the largest market share in the UK I am sure would be enticing for them as well.

It would as you say certainly cost them a lot but it would certainly be worth the cost if done rightly.

O2 Ireland has been acquired by Three, despite Three already having an MBNL style network share in place with Vodafone Ireland.
True hadn't considered that Three Ireland after merger goes through will have the best 4G spectrum portfolio in Ireland so it has worked out well for them. Expect Vodafone are slightly worried about losing top position in Ireland.
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Old 16-11-2013, 00:09
carguy143
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If Three were to buy o2 UK, I would expect OFCOM to force them to reduce their network size like they did with Orange and T-mobile when they formed EE.
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Old 16-11-2013, 00:33
Aye Up
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I don't see this happening either.
I have to agree with you there, the reason I don't it happening is O2 as a business is actually losing customers over longer term. I don't remember what their churn rate was last quarter but it certainly was the largest of all the networks. Three is making solid progress in increasing both the customer count and market share with very little marketing efforts in fact. Aggressive priving strategies for SIMO and contract is bearing the fruits of their labours.

Well I would love for this to happen and it is certainly a possibility with Three looking to expand it's European telecoms portfolio. I can't honestly see it happening will certainly change the European market if it did though.

Three would become leaders in three countries.

Spain
UK
Germany (If merger goes through)

And have a good foothold in quite a few other European countries.
The way the UK mobile market is handled is somewhat different to that of our European cousins. It is highly unlikely a merger would be allowed between O2 and Three as it would then mean spectrum allocation rights would have to be reviewed as you would end up with one provider holding slots in almost every available range and thus reducing the value of existng holdings by EE and Vodafone.

Well that won't happen, Telefonica are $50BN in debt and have been disposing of assets like O2 Ireland to Hutchison Whampoa (Three's owners), they also sold or sold parts of O2 Germany, O2 Czech republic, Latin American businesses, Attento, China Unicom and many others.

Hutchison Whampoa (Three's owners) are looking to buy "debt encumbered European telecoms companies" as part of their strategy and are currently selling prized assets in Hong Kong in order to raise 20BN to enable that.

Telefonica is Europe's most indebted telecoms company.
They are the most indebted company yet they want to pony up 10B euros to buy another German operator?

http://online.wsj.com/news/articles/...23032699768600

Can't be in that much dire straits can they?

Which is another reason why I don't think Three and O2 will merge because of this site sharing. Though theoretically it is entirely possible it could continue as MBNL is 2G & 4G 1800MHz and 3G 2100MHz where as Cornerstone is 4G 800MHz and 2G & 3G 900MHz. So there isn't a massive crossover but if it did happen it would be an interesting how that would work.
In theory you are right however one company holding spectrum in all ranges would devalue the holdings of the others, which is one other reason why I think it wouldn't go ahead.

The chairman is Asia's richest man, but aside from the personal wealth, the company is actively clearing Asian assets to raise over 20BN as they seen an opportunity to be European phone companies from debt laden companies.

Ofcom will allow 4 'companies', Three's takeover of O2 Ireland is going through despite the fact they already network share with Vodafone Ireland. The only way the UK network can consolidate as has happened in other European countries is Hutchison taking O2 off debt laden Telefonica's hands, solving Telefonica's debt problems.

Vodafone UK isn't up for merger or sale as it's their home market, EE is already consolidated and too big for further merger or consolidation - wouldn't get past the regular. Three is not for sale as Hutchison want to buy in Europe, not sell, that leaves only 1 option for consolidation of the UK market, and that is Hutchison doing what they did in Ireland and owning O2 UK and Ireland.
Again you mention debt problems but Telefonica is buying a massive German operation???

Hutchison is unlikely to buy O2 as the growth in that company is limited, it is hamstrung by an exorbitant cost base. Anyone that takes on O2 is on a hiding to nothing, there is little value in a merger with O2, Three is managing to grow fine by itself. The merger with O2 would throw Hutchison's aggressive pricing strategy out the window, as there would be no way with the overheads O2 has it would be able to compete. Yes cost cutting drives would take place but a behemoth the size of O2 with the size of its infrastructure moving any jobs abroad in the current climate would be commericial suicide. Three operates from the lowest cost base of all the networks, further to this a merger with O2 would likely impact the business relationship it has with Tesco who no doubt have some kind of veto on any potential change in business partner.

If Three were to buy o2 UK, I would expect OFCOM to force them to reduce their network size like they did with Orange and T-mobile when they formed EE.
OFCOM didn't force either operator to reduce their network size, this is something they have undertaken independently as they felt they didn't need as many masts as they had (as its turning out they are having to re-activate masts in some areas where service levels have went through the floor). They were forced to dispose of 30mhz of their 1800 spectrum holding as the merger of the two companies would have meant they had a monopoly on it. Someone better informed than me can explain the terms of the disposal more clearly.
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Old 16-11-2013, 01:05
enapace
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I have to agree with you there, the reason I don't it happening is O2 as a business is actually losing customers over longer term. I don't remember what their churn rate was last quarter but it certainly was the largest of all the networks. Three is making solid progress in increasing both the customer count and market share with very little marketing efforts in fact. Aggressive priving strategies for SIMO and contract is bearing the fruits of their labours.

The way the UK mobile market is handled is somewhat different to that of our European cousins. It is highly unlikely a merger would be allowed between O2 and Three as it would then mean spectrum allocation rights would have to be reviewed as you would end up with one provider holding slots in almost every available range and thus reducing the value of existng holdings by EE and Vodafone.
I agree as I said above I would love to see it happen as I think after a lot of problems that would incur it would work well.

I just don't think OFCOM would ever approve it.
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