Three promises no price rises for five years if O2 merger goes ahead
Mobile customers with Three and O2 can look forward to no price rises for five years if the proposed merger goes ahead.
Canning Fok, chairman of Three UK, has pledged that a combined Three and O2 will not raise the price of “a voice minute, a text or a megabyte in the five years following the merger”, should it go ahead.
Mr Fok's comments come after Ofcom CEO Sharon White openly warned that the deal, which is currently being investigated by the European Commission could mean higher prices for consumers and businesses.
Combined, Three and O2 would create the UK’s largest mobile network, with 41% of the market share compared to EE’s 32% and Vodafone’s 24%.
The European Commission launched its in-depth probe into the planned merger amid concerns that it could lead to higher prices, less choice and reduced mobile innovation in the UK.
In the wake of Ms White’s widely-reported concerns, Mr Fok, who is also group co-managing director of Three’s parent company CK Hutchison Holdings, wrote in an open letter: “Readers in Britain must have been bemused by the blizzard of commentary and speculation earlier this week around telecoms competition in the UK.
“We might be forgiven for wondering why Sharon White, the new CEO of Britain's telecom regulator Ofcom, felt the pressing need to go public with her conclusions about the effects of CK Hutchison’s proposed acquisition of O2 without having asked for or heard our views in response to her concerns.
“Over the last 12 years our group spent billions to enable Three to be a major competitive force in UK mobile.
“From the outset, we have followed the principle that as technology improves people should always get more and pay less for their mobile services.”
He said the company had strived to be “a consistent force for consumers”, building a reputation as “the challenger in Britain”.
Mr Fok said the combination of Three and O2 would be able to stand up to “the new Leviathon BT” and “the old top-of-the-heap predator Vodafone”, making it possible to guarantee that in five years customers could get more and pay less for mobile services.
He made three promises: not to raise prices for five years following the planned merger; to invest £5bn in the businesses over the next five years; and that a merger would deliver “real competition”.
“In short, over the next five years Three+O2’s customers will be getting more and paying less than they do today for mobile services and the wholesale market will also be better off.
“Let me emphasise: This is not an aspiration. It is a guarantee.
“Over the coming weeks the promises I have laid out will be an important part of the case Three will put to Europe’s competition authorities, who have had the wisdom not to rush to judgment until, as the law requires, they have heard our response to their concerns.
“We believe they will make the right choice for Britain, for British consumers, and for Europe.”
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