The Financial Times is reporting that Vodafone could be on a shopping spree and are looking to acquire T-Mobile. This would make it the biggest UK mobile phone operator, but would it be good for customers?
Vodafone, which is the world's largest mobile operator by revenue, is considering the business merits of acquiring T-Mobile UK which has been valued at £2.5 to £3 billion.
If Vodafone bought T-Mobile it would make Vodafone the biggest mobile operator in the UK, with a 40% market share. Currently Vodafone has a 25% share of the UK market and T-Mobile, which is owned by Deutsche Telekom, has a 15% share.
The question for the UK consumer is would such a large mobile phone operator be good for prices, service and overall competition. There are currently 5 UK mobile phone operators O2, Vodafone, Orange, T-Mobile and 3. Five is a health number and reducing it to 4 shouldn’t make too much of a difference. If the new, larger Vodafone doesn’t provide the service that customers are expecting there would still be lots of other places to go. However one possible knock-on effect would be that another 2 mobile operators could merge to compete with Vodafone and that would certainly be bad for UK customers.
From a business point view, and ignoring the so called economical crisis, there are 3 negative points about this merger:
- If it is deemed that such a large operator threatens competition the merger could be blocked by UK regulators.
- T-Mobile UK reported a 21% fall in sales in the first three months of the year.
- T-Mobile currently has a network-sharing deal with 3, which might need to be changed and 3 compensated.
Tell us what you think? Are you a Vodafone or T-mobile customer? Would it bother you if they merged?
2 thoughts on “Could Vodafone Buy T-Mobile? New UK Mobile Giant Possible”
im with t-mobile and i hope they do merge so i can cancel my contract when the t&cs change:)
I think that Vodafone should team up with Orange and then they would be an unstoppable force in the mobile phone market.