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Three takeover of o2 for £10bn done


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Old 24-03-2015, 21:55
Thine Wonk
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Point taken. The question will be if they scrap the EE brand after acqusition completes, or keep it as they've done with Dabs / BT Shop.

http://shop.bt.com
http://www.dabs.com
Definitely without a shadow of a doubt BT Mobile, so they can offer BT home phone, BT broadband, BT TV and BT Mobile.
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Old 24-03-2015, 21:58
moox
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Also Plusnet - left to its own devices more or less, to the point that it is generally much more highly regarded than BT proper

"BT Mobile" could simply be an MVNO on a network that will continue to be called EE - it lets them do the quad play rubbish without yet another expensive rebrand and it also creates the illusion of choice

(and EE broadband could simply become another brand of BT-Plusnet if they don't decide to dump it and move everyone over)
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Old 24-03-2015, 22:01
DevonBloke
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O2 & Three together also have far too little spectrum for the combined number of customers. The biggest network could therefore become the most congested. (well if some of that 45% of O2 customers still on feature phones upgrade to smartphones).
That is exactly what I was thinking.
Are O2 customers going to wake up one morning to find they have access to Three's side of the MBNL network?
If so, how the hell is it going to cope?
And how do they integrate two completely different networks?
Possibly using all of the MBNL sites, transferring O2s 3G/4G spectrum to them and then doing an "EE" and decommissioning loads of O2 sites?
What a bloody nightmare!!
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Old 24-03-2015, 22:07
jchamier
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That is exactly what I was thinking.
Are O2 customers going to wake up one morning to find they have access to Three's side of the MBNL network?
If so, how the hell is it going to cope?
And how do they integrate two completely different networks?
Possibly using all of the MBNL sites, transferring O2s 3G/4G spectrum to them and then doing an "EE" and decommissioning loads of O2 sites?
What a bloody nightmare!!
My guess - keep O2 network as 2G, turn off O2 3G 2100, leave O2 3G 900mhz. Start migrating O2 4G transmissions to MBNL Three 4G sites, to give 2x20 at 800mhz alongside the 2x15 at 1800mhz.

Take 4 years minimum - and like EE, only make changes in areas where both have coverage, leaving those areas where one has coverage and not the other until last. Enable roaming between both, and rebrand fast, so the two networks are seen as one by the customers.
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Old 24-03-2015, 22:07
DevonBloke
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I just hope I can still have "EE" in my status bar and not "BT Mobile".
If I can't, I'm off to Thro2
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Old 24-03-2015, 22:09
Thine Wonk
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That is exactly what I was thinking.
Are O2 customers going to wake up one morning to find they have access to Three's side of the MBNL network?
If so, how the hell is it going to cope?
And how do they integrate two completely different networks?
Possibly using all of the MBNL sites, transferring O2s 3G/4G spectrum to them and then doing an "EE" and decommissioning loads of O2 sites?
What a bloody nightmare!!
They plan to keep all the sites, and you'll find that this time next year they will have both rolled out much more 4G. The speeds will equalise and when they do cut over the benefits will work both ways.

I don't think it will be as bad as you think it might be, given the fact they both have their respective capacity to deliver to their customers today, a bigger pool should level off performance and average.

Some will experience slower 4G, some will get faster, some will get 2G backup, some will get better 3G etc etc.

They can also apply different traffic priority where needed too, eg: unlimited plans de-prioritised.
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Old 24-03-2015, 22:10
jchamier
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I just hope I can still have "EE" in my status bar and not "BT Mobile". If I can't, I'm off to Thro2
Jailbreak your iPhone and you can show anything apparently!

I reckon they'd use just "BT" as the network logo, it works nicely and is short like "3" or "O2" and not the stupidly long "Vodafone UK" which on many handsets wraps. But who knows what they'll actually do.

"BT Mobile powered by EE" could scroll across your screen
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Old 24-03-2015, 22:15
Aye Up
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It isn't a killer, 41% isn't even that high compared to other markets with 2 or 3 main companies or when compared to other non UK markets. If there are 3 competitors like there are with many EU mobile markets 40/30/30 is perfectly ok, you're never going to get a perfect 33/33/33. The key thing is the transmission network will span both BT and Vodafone.

Voda can certainly pack a punch being the worlds largest mobile group by revenue, they won't be threatened by a company that is 7% bigger. BT won't either as they have a spread of assets and markets they operate in, nobody is in a weak position in the market and they are all fit and capable, I think you're making a bigger deal than there really is with this 41% thing.

Voda will be happy in the sense that they will still have a Cornerstone partner, BT will be happy as they will still have an MBNL partner, HWL would otherwise exit the UK anyway, which would be undesirable.
When I say "killer" I don't mean it scuppers the tie up, far from it. But when any competition authority rules on these mergers, its with a firm eye on that market share in addition to the reduction in competition.

As for the 40/30/30 working in other markets care to offer an example? Sadly Vodafone isn't even near 24% market share, yes it has deep pockets but that doesn't alter the fact that it will go from being 3rd amongst a group of 3 operators in size, to having half the market share of the merged business. They are already harping on about the proposed BT/EE tie up (also O2 somewhat hypocritically), I don't think they will keep quiet on this. Not that it would necessarily change anything, although I do doubt BT/EE and Vodafone would be happy even if there were no changed to Cornerstone or MBNL.

There is a lot of unravelling that would need to happen, spectrum wise I highly doubt they would need to offer concessions there. I think it would be around the network roaming, BT/EE or Vodafone wouldn't allow it quite frankly, they will have to offer a significant incentive to even open discussions.

The market share is important, whether you like it or not, I have alluded to many times that the UK market is somewhat unique when it comes to Telecoms. However this deal will need to be scrutinised by Government, Parliament (Select Committees), OFCOM, CMA and then finally the EC. The EC will decide on the outcome, I also believe they will do it in consultation with those aforementioned authorities.
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Old 24-03-2015, 22:16
DevonBloke
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They plan to keep all the sites, and you'll find that this time next year they will have both rolled out much more 4G. The speeds will equalise and when they do cut over the benefits will work both ways.

I don't think it will be as bad as you think it might be, given the fact they both have their respective capacity to deliver to their customers today, a bigger pool should level off performance and average.

Some will experience slower 4G, some will get faster, some will get 2G backup, some will get better 3G etc etc.

They can also apply different traffic priority where needed too, eg: unlimited plans de-prioritised.
Do you think they will do what jc says and transfer O2s (10Mhz I think) of 3G spectrum over to the MBNL side thereby giving them 25Mhz (again, I think).
This would need to be done surely otherwise several million O2 handsets suddenly jumping on the Three network is going to kill it.
Am I wrong?
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Old 24-03-2015, 22:18
Aye Up
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O2 & Three together also have far too little spectrum for the combined number of customers. The biggest network could therefore become the most congested. (well if some of that 45% of O2 customers still on feature phones upgrade to smartphones).
See I don't doubt that, spectrum wise there are no competition concerns. If I'm honest I think either would the the recipients of the inevitable divestment of BT's share in the 2600 range. If the merger does take place then I should imagine the parent company would would open the cheque book to bring O2's network into the 21st century (their 4G is shit).
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Old 24-03-2015, 22:20
The Lord Lucan
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Hold on. Three hasn't bought O2.. There is a difference!
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Old 24-03-2015, 22:24
Aye Up
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Hold on. Three hasn't bought O2.. There is a difference!
Technically yes, but in principal no. If approved it will likely mean the end of the O2 brand within the next few years.
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Old 24-03-2015, 22:29
jchamier
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Hold on. Three hasn't bought O2.. There is a difference!
True, HWL could easily run them as separate networks. Would be a strange decision and cost more.
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Old 24-03-2015, 22:32
Thine Wonk
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When I say "killer" I don't mean it scuppers the tie up, far from it. But when any competition authority rules on these mergers, its with a firm eye on that market share in addition to the reduction in competition.

As for the 40/30/30 working in other markets care to offer an example? Sadly Vodafone isn't even near 24% market share, yes it has deep pockets but that doesn't alter the fact that it will go from being 3rd amongst a group of 3 operators in size, to having half the market share of the merged business. They are already harping on about the proposed BT/EE tie up (also O2 somewhat hypocritically), I don't think they will keep quiet on this. Not that it would necessarily change anything, although I do doubt BT/EE and Vodafone would be happy even if there were no changed to Cornerstone or MBNL.

There is a lot of unravelling that would need to happen, spectrum wise I highly doubt they would need to offer concessions there. I think it would be around the network roaming, BT/EE or Vodafone wouldn't allow it quite frankly, they will have to offer a significant incentive to even open discussions.

The market share is important, whether you like it or not, I have alluded to many times that the UK market is somewhat unique when it comes to Telecoms. However this deal will need to be scrutinised by Government, Parliament (Select Committees), OFCOM, CMA and then finally the EC. The EC will decide on the outcome, I also believe they will do it in consultation with those aforementioned authorities.
Austria has 3 networks, the largest has a 43% share
Greece 47% for the largest, the other 2 are smaller
Ireland has 3 networks now, one of which is bigger
Czech Republic
Belgium has 3 networks, the biggest is much bigger than the other 2
Portugal has 3 providers, 1 of which is much bigger than the others and higher than 40%.
Switzerland has 3 operators, one of which is larger than the other 2 put together.
Turkey - another example
The Netherlands, another example of 3 networks, 1 which is much bigger than the other 2

Why have 1 example when you can have 9? even in France 1 operator has a 10% lead over the next biggest.

Competition wise there really can't be any big concerns over the likes of HWL being able to dominate the likes of Vodafone, the largest mobile group by revenue in the world, or BT with it's very divergent portfolio of services and it's market size.

I repeat, you're making too much of a big meal of the 43% thing. I don't see that as a big issue, the mast sharing was always going to be the big issue, but as HWL say to reduce competition issues they will remain in Cornerstone and MBML and don't plan to consolidate infrastructure I think that'll go a long way to reduce competition concerns. EE and BT won't kick up a competition fuss because they are in the same boat. That only leaves Voda, but I suspect HWL have done deals as they already work with Voda on mast shares in Ireland and plan to in the UK with Cornerstone.
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Old 24-03-2015, 22:34
DevonBloke
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Hold on. Three hasn't bought O2.. There is a difference!
Yes, but we are just pretending they have...
Get with the program....
Hahahahahaha
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Old 24-03-2015, 23:21
totalhysteria
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Apart from an illusion of choice to those not in the know, what would be the benefits of keeping the networks separate?
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Old 24-03-2015, 23:25
moox
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Apart from an illusion of choice to those not in the know, what would be the benefits of keeping the networks separate?
Network issues would affect fewer customers - O2 could have a catastrophic network fault and it wouldn't necessarily affect people on 3. Depending on the type of fault it could also help reduce the scale of the issue, because people on the broken network might be able to get access to the working one.

More jobs for mobile phone network engineers

Less hassle as far as existing network sharing goes - 3 and EE share parts of their network, and O2 and Vodafone are sharing parts of theirs - if they merged networks it might mean EE or Vodafone getting the shaft from reduced investment from their partner compared to what will be happening right now as separate entities

Less short-term teething troubles from trying to merge the two networks together - especially two networks that seem totally different in quality, coverage levels and so on

One downside will be that it will cost more in the long run and won't promote the most efficient use of resources (masts, backhaul connections, radio spectrum)
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Old 24-03-2015, 23:30
Aye Up
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Austria has 3 networks, the largest has a 43% share
Greece 47% for the largest, the other 2 are smaller
Ireland has 3 networks now, one of which is bigger
Czech Republic
Belgium has 3 networks, the biggest is much bigger than the other 2
Portugal has 3 providers, 1 of which is much bigger than the others and higher than 40%.
Switzerland has 3 operators, one of which is larger than the other 2 put together.
Turkey - another example
The Netherlands, another example of 3 networks, 1 which is much bigger than the other 2

Why have 1 example when you can have 9? even in France 1 operator has a 10% lead over the next biggest.

Competition wise there really can't be any big concerns over the likes of HWL being able to dominate the likes of Vodafone, the largest mobile group by revenue in the world, or BT with it's very divergent portfolio of services and it's market size.

I repeat, you're making too much of a big meal of the 43% thing. I don't see that as a big issue, the mast sharing was always going to be the big issue, but as HWL say to reduce competition issues they will remain in Cornerstone and MBML and don't plan to consolidate infrastructure I think that'll go a long way to reduce competition concerns. EE and BT won't kick up a competition fuss because they are in the same boat. That only leaves Voda, but I suspect HWL have done deals as they already work with Voda on mast shares in Ireland and plan to in the UK with Cornerstone.
Ok point taken regarding other countries, however in those which have market around 40% how many of those were as a result of a merger? Or how many were the result of a natural monopoly? (they grew so big naturally). Finally those markets where one network has over 40% how many of those markets suffered an increase in prices as a result from decreased competition?

I agree the sticking point will include the issues around Cornerstone and MBNL, HW may say they will continue to be part of both, however in practice that is likely to be challenging. Vodafone will be loathe to allow roaming between the two schemes for the HW companies, EE I think will be prickly but can be overcome. For each scheme the respective operators have safeguards built in which protects their investment, mergers also come into that if I am not mistaken. Three and O2 have committed funding in respect of each rollout (though there has been suggestion O2 has been reluctant to rollout 4G quickly, possibly the sale is the reason why), how does that affect things?

Market share will have a bearing any decision, its not the only measure used either. Market impact, price increases, reduction of competition, loss of revenue for the treasury, monopoly status, the list is endless. TBH we can disagree over semantics, I think we both want the same thing: a competitive market which benefits business and personal customers alike.
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Old 24-03-2015, 23:31
Thine Wonk
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Apart from an illusion of choice to those not in the know, what would be the benefits of keeping the networks separate?
We need to be careful here too about what we mean by networks. We mean infrastructure radio access share projects, the network codes could be consolidated as could the core, but they number of cells and the arrangements with other parties for RAN shares would remain and the number of sites, that is my understanding.
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Old 24-03-2015, 23:33
DevonBloke
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Apart from an illusion of choice to those not in the know, what would be the benefits of keeping the networks separate?
I see what you did there....
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Old 25-03-2015, 00:32
Everything Goes
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Telefónica announced today that it has agreed terms to offload O2 UK to Hutchison Whampoa in a deal worth £10.25 billion. An initial payment of £9.25 billion will be followed by an 'additional deferred payment' of a billion pounds, the timing of which will depend on how quickly the combined company reaches a predefined cash flow threshold.
I wonder what that means for consumers? Im almost at the end of my contract and I feel im at a crossroads and im not sure who to go with.

http://www.neowin.net/news/three-agr...-uk-for-1025bn
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Old 25-03-2015, 00:37
Everything Goes
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Hutchison could license the O2 brand in the UK to run alongside or instead of Three in future, according to one person familiar with the situation. However, he added that a final decision had not been made.

Hutchison will pay an initial £9.25bn, with an additional deferred payment of £1bn once the cumulative cash flow of the combined company in the UK reaches an agreed threshold.

Telefónica said it would use a substantial part of the proceeds to reduce debt.
Significant.

http://www.ft.com/cms/s/0/9d43d52c-d...#axzz3VLx3MO9x
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Old 25-03-2015, 03:35
Chrysalis
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It is perfect actually.

Three will get 2G backup
O2 will get really good 3G
Three will get the expansion of 4G coverage
The best of both worlds in terms of MBNL / Cornerstone, both will be kept with no plans to shut of masts so they say

They aren't buying the quadplay argument that BT and Vodafone are betting on, many analysts also agree it isn't what it's cracked up to be, only 6% of Virgin Media customers take all services and they haven't managed to push mobile heavily despite the Virgin Mobile brand being big.
where will O2 get really good 3G from? as three's 3g is abysmal. congested to hell and back.
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Old 25-03-2015, 03:38
Chrysalis
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Also Plusnet - left to its own devices more or less, to the point that it is generally much more highly regarded than BT proper

"BT Mobile" could simply be an MVNO on a network that will continue to be called EE - it lets them do the quad play rubbish without yet another expensive rebrand and it also creates the illusion of choice

(and EE broadband could simply become another brand of BT-Plusnet if they don't decide to dump it and move everyone over)
thats the ensible thing to do, and its what I would do.

EE is a very strong brand now, has a great reputation, it would be bonkers to ditch the name.
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Old 25-03-2015, 05:00
jaffboy151
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Another one of your joke posts I see...
http://youtu.be/PZmYKuQGbRA

I was trying to make a serious point about data capacity and network infurtructure though.. At present there is significant issues concerning both surely
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