3 UK CEO: Britain could manage with 3 mobile networks

Joining other leading European executives in calling for telecoms market consolidation, 3 UK CEO David Dyson said the UK could operate with just three mobile networks under the right circumstances.

Dyson

In an interview with the Guardian, Dyson, responding to rumours that Hutchison Whampoa-owned 3 UK could be interested in buying Telefónica's O2 UK, said mobile operators across Europe were being pushed towards mergers as they suffer "death by 1,000 cuts" amid falling revenue and rising costs, and predicted a round of consolidation in Europe from 2014.

Dyson also said any mergers would have to ensure balance in the market, leaving a trio of strong players at the end of the process. The UK currently has four mobile networks if the LTE network of EE and the 3G networks of Orange UK and T-Mobile UK are grouped as one entity. O2 UK, Vodafone UK and 3 UK also operate 3G and increasingly LTE networks.

Europe's leading telecoms executives have been falling over themselves to call for more industry consolidation to counter falling prices in the market. The CEO of Danish operator TDC, Carsten Dilling, recently said the Nordic markets would benefit from mergers, while Deutsche Telekom CEO Rene Obermann also recently said the time is now right for European operators thinking of mergers and acquisitions to make their move.

3 UK's Hong Kong parent is a particularly acquisitive company and has recently agreed to buy Telefónica's unit in Ireland. Its Austrian unit has also merged with Orange Austria, meaning that there are now three rather than four operators in Austria.

How the European Commission deals with current M&A plans such as KPN's €8.55 billion ($11.62 billion) sale of its German E-Plus business to Telefónica, and Hutchison Whampoa's acquisition of Telefónica Ireland, is being watched with interest.

Orange CEO Stephane Richard said in September that he believes the E-Plus deal, if approved, would trigger a massive shift in Europe's telecoms industry.

For more:
- see this Guardian article

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Analysys Mason: Mobile M&A in Western Europe may help ease pressure on revenue
Germany challenges EU over right to examine Telefónica's E-Plus deal
Despite a gloomy outlook, will European M&A catch fire in 2014?

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