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BT/EE deal will deliver ‘seamless’ broadband and mobile connections

Wednesday, June 17th 2015 by Phil Wilkinson-Jones

Consumers will benefit from further investment in the UK’s broadband and mobile infrastructures if BT’s planned takeover of EE goes ahead.

BT’s CEO Gavin Patterson said the acquisition would create a “true UK digital champion” and a highly competitive market.

EE boss Olaf Swantee said the deal would result in continued investment to boost what he described as the "most digitally hungry country in Europe", and warned against allowing competitors to put "roadblocks" in the way of the deal.

The two chief executives were speaking at the launch of a report, commissioned by BT, looking at trends in the telecoms industry that the merged company could take advantage of.

The proposed takeover itself is currently being investigated by the Competition and Markets Authority (CMA) and needs the watchdog’s permission if it is to proceed.

Mr Patterson said the deal would create a company with the scale and expertise to deliver the UK’s connected future, and would help put “clear blue water” between the country and its international rivals.

He said other companies operating in the UK would be able to benefit and compete through highly regulated, equal access to Openreach’s network, and wholesale access to the EE mobile network.

“The world is changing with customers wanting access to the internet on their terms,” he said.

“They are spending more time online than ever before and they want the best connection whether they are at home, in the office or on the move.

“Seamless connectivity is the future and we are keen to deliver the new, innovative services of the future.”

Mr Patterson added that the merger would put the new company in a better position to offer bundled broadband, home phone, TV and mobile packages, known as 'quadplay'.

'Customer benefits'

Mr Swantee highlighted how the merger between T-Mobile and Orange had unlocked investment and enabled EE to drive 4G forward in the UK.

He said: “In BT and EE you are bringing together two companies with a similar core belief – two companies that share a renewed commitment to network leadership, innovation and delivering the best for their customers.

“A world-leading, combined fixed and mobile, digital infrastructure will sit at the heart of a successful UK economy.”

“The success of the UK in the future will be built on its ability to deliver real-time, data-heavy information through leading edge network technology. Bringing BT and EE together makes that possible.”

Mr Swantee warned of the danger of allowing self-interested companies to obstruct the deal: “These competitors only want to put up roadblocks, while we want to build motorways for the UK.”

The report, by Rob Kenny of Communications Chambers, looks at five industry trends that an integrated BT and EE will be well-placed to address.

These are: an increased demand for data in fixed and mobile networks; the need for a reliable service; pressure on the public sector to digitise services; pressure on networks because of the development of the 'internet of things'; and rapid change in the telecoms industry.

Mr Kenny says in the report: “The merger has the potential to generate a wide array of customer benefits driven by enhanced investment, innovation, efficiency and competition for converged services.

“Notwithstanding the merger, the UK would continue to be a well contested market by comparison to its European peers, with some of the most pro-competitive market interventions globally.”

BT expects the CMA’s investigation process and the EE transaction to be completed by the end of March 2016.

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