Good or bad eu blocks 3 takeover

[ricgem2002]

the eu blocks 3s takeover bid http://www.bbc.co.uk/news/business-36266924 is this a good or bad move?

[altus]

It's worth noting, as The Register does, that Ofcom have been lobbying the EU competition regulator for this decision. It's not so much the EU blocking the merger as UK regulator getting the EU to block the merger.

[ricgem2002]

It's worth noting, as The Register does, that Ofcom have been lobbying the EU competition regulator for this decision. It's not so much the EU blocking the merger as UK regulator getting the EU to block the merger.

does this mean the uk regulator needs the approval of the eu regulator before a decision can be made ?

[the_bloke]

the eu blocks 3s takeover bid http://www.bbc.co.uk/news/business-36266924 is this a good or bad move?

 

It's a good thing. Competition means more choice and innovation. Which is exactly what Ofcom and the EU have said.

[ricgem2002]

It's a good thing. Competition means more choice and innovation. Which is exactly what Ofcom and the EU have said.

not from what I read in the link:suspect:

[the_bloke]

not from what I read in the link:suspect:

 

No idea what you were reading then. That BBC article links through to the actual statement from the EU, which mirrors what The Register said, linked in post #2

 

http://europa.eu/rapid/press-release_IP-16-1704_en.htm

 

The significantly reduced competition in the market would likely have resulted in higher prices for mobile services in the UK and less choice for consumers than without the deal. The takeover would also likely have had a negative impact on quality of service for UK consumers by hampering the development of mobile network infrastructure in the UK. Finally, the takeover would have reduced the number of mobile network operators willing to host other mobile operators on their networks.

 

Commissioner Margrethe Vestager, in charge of competition policy, said: "We want the mobile telecoms sector to be competitive, so that consumers can enjoy innovative mobile services at fair prices and high network quality. The goal of EU merger control is to ensure that tie-ups do not weaken competition at the expense of consumers and businesses.

 

Allowing Hutchison to takeover O2 at the terms they proposed would have been bad for UK consumers and bad for the UK mobile sector. We had strong concerns that consumers would have had less choice finding a mobile package that suits their needs and paid more than without the deal. It would also have hampered innovation and the development of network infrastructure in the UK, which is a serious concern especially for fast moving markets. The remedies offered by Hutchison were not sufficient to prevent this."

[altus]

does this mean the uk regulator needs the approval of the eu regulator before a decision can be made ?

Probably more a case of the UK regulator said no, or at least indicated they were going to, so the companies complained to the EU regulator - who agreed with the UK regulator.

[ricgem2002]

No idea what you were reading then. That BBC article links through to the actual statement from the EU, which mirrors what The Register said, linked in post #2

 

http://europa.eu/rapid/press-release_IP-16-1704_en.htm

 

The significantly reduced competition in the market would likely have resulted in higher prices for mobile services in the UK and less choice for consumers than without the deal. The takeover would also likely have had a negative impact on quality of service for UK consumers by hampering the development of mobile network infrastructure in the UK. Finally, the takeover would have reduced the number of mobile network operators willing to host other mobile operators on their networks.

 

Commissioner Margrethe Vestager, in charge of competition policy, said: "We want the mobile telecoms sector to be competitive, so that consumers can enjoy innovative mobile services at fair prices and high network quality. The goal of EU merger control is to ensure that tie-ups do not weaken competition at the expense of consumers and businesses.

 

Allowing Hutchison to takeover O2 at the terms they proposed would have been bad for UK consumers and bad for the UK mobile sector. We had strong concerns that consumers would have had less choice finding a mobile package that suits their needs and paid more than without the deal. It would also have hampered innovation and the development of network infrastructure in the UK, which is a serious concern especially for fast moving markets. The remedies offered by Hutchison were not sufficient to prevent this."

just read this bit

"CK Hutchison responded to the decision, saying the acquisition of O2 from Spain's Telefonica would bring "major benefits to the UK not only by unlocking £10bn of private sector investment in the UK's digital infrastructure but also by addressing the country's coverage issues, enhancing network capacity, speeds and price competition for consumers" depends what you look for I guess:roll:

[altus]

just read this bit

"CK Hutchison responded to the decision, saying the acquisition of O2 from Spain's Telefonica would bring "major benefits to the UK not only by unlocking £10bn of private sector investment in the UK's digital infrastructure but also by addressing the country's coverage issues, enhancing network capacity, speeds and price competition for consumers" depends what you look for I guess

Indeed it does. Rory Cellan-Jones's analysis includes this (my bold):

The big operators put the blame on too much competition and over-regulation. They argue that Brussels should focus on competition across the EU, not in individual markets, pointing out that while Europe has dozens of competing operators, the US has just a handful, each earning much more from users than is possible here.

It might be worth comparing what services US customers get for the higher prices they pay before wanting to reduce competition over here.

[Ghozer]

So they deny this, because they think it will hurt the others and there's not enough competition..

 

Yet they have allowed BT to purchase EE..... they say it won't hurt the market because BT's not already a player in Mobiles, yet (at least as far as I'm aware) BT have always had some form of mobile service offering, be it BTCellnet (which turned into O2 eventually) or using someone elses network (like currently)