Euro consumers have TOO MUCH choice – telco operators

Let us meeeeerrrrrge, GSMA begs European Commission

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Three or four market players is plenty, at least according to the GSMA, the association that represents nearly 800 mobile operators.

At an event in Brussels this week, GSMA director Anne Bouverot said it was ridiculous that there were nearly 100 players in the EU market while the US does perfectly well with four or five.

In recent years, mergers and consolidations in Europe have come at a price, with the European Commission imposing rules and restrictions before approving the deals.

But, according to Bouverot: “Consolidation can boost investment in next generation mobile infrastructure and delivery of mobile broadband to rural areas."

Operators argue that it could become impossible to remain viable if they are not able to pool resources with partners or rivals.

Despite the Commission’s antitrust arm worrying that mergers reduce consumer choice and push up prices, Bouverot says, “There is little evidence that markets with four operators have lower prices, over the long term, than those with three.”

The GSMA called on competition authorities to “more readily consider the advantages of mobile mergers and in particular the long-term benefits they can deliver to consumers” and rely less on existing pricing analysis. In other words, “Please put fewer constraints on us”.

According to a report commissioned by the GSMA, “[I]f operators are compelled to provide access to their networks to third parties, this could reduce rather than sharpen incentives to invest as a result of the merger, significantly reducing benefits to consumers.” ®


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