Vodafone Warn Gov 5G Targets to be Missed if Three UK Merger Blocked
The CEO of mobile operator Vodafone, Ahmed Essam, has indirectly warned regulators that a decision to block its attempted merger with Three UK (CK Hutchison) would result in them cutting their investment in digital infrastructure (5G broadband etc.) and being unable to deliver on the Government’s goals.
Last month saw the operators reveal that they’d finally reached a formal merger agreement (here), which is said to be worth an estimated £15bn and will see the former party owning a 51% slice of the business (CKH will hold 49%). The combined business is expected to unleash a significant £11bn investment in mobile infrastructure, although concerns remain over its impact upon competition and consumer pricing etc.
The merged company committed, among various other things, to reach more than 99% of the United Kingdom’s population with their latest 5G Standalone (SA) network by 2034, and to offer fixed wireless access (mobile home broadband) to 82% of households by 2030.
According to The Times, Essam said that, without the deal, “we won’t be able to invest as much, and we won’t be able to deliver the 5G ambition that’s coming in the wireless infrastructure strategy from the government. It will just slow us down.” The Government’s new Wireless Infrastructure Strategy (WIS) set out an ambition for “all populated areas to be covered by ‘standalone’ 5G (5G-plus) by 2030” (here).
The transaction is expected to close before the end of 2024, subject to regulatory and shareholder approvals. Both Ofcom and the Competition and Markets Authority (CMA) are known to have softened their position on mergers that result in the number of primary mobile operators being reduced from four to three, but the price will still be high and significant concessions may need to be made (spectrum divestment, pricing commitments, network sharing and security etc.).
Mark is a professional technology writer, IT consultant and computer engineer from Dorset (England), he also founded ISPreview in 1999 and enjoys analysing the latest telecoms and broadband developments. Find me on X (Twitter), Mastodon, Facebook and Linkedin.
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3G was crap , 4G was crap , 5G so far is crap .
Maybe they should get good at delivering reliable and consistent speeds and coverage before anything else
Experiences will always vary on mobile between different locations and networks, because catering for 100% geographic coverage at high speed would be an economically difficult problem to solve (often deemed unviable) and operators are not charities. But generally, 4G has been quite good.. for most people, provided you pick the best provider for your area.
That’s perhaps a bit extreme. I have found Vodafone 4G and 3G to be pretty good and likewise for Three.
They may not be as good as EE but both of them are leaps and bounds ahead of O2.
I’m sat here with 1340mbps on 5G while indoors.
Of course they will say that – they’ll say anything they can that they think will get their deal approved. Realistically, the question is why are they not on track to meet targets regardless when they should be!
All the council mast planning refusals is one clear reason why they are not on track.
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What a cheap silly black mail. If they can’t make their current stack working fine individually how they want to make it working after merge? I am pretty sure they already have a bag of excuses prepared.
Yes, but a good chance it will work. Who’s minister in charge as the Department of Science, Innovation & Technology? That’ll be Chloe Smith, well equipped to understand the business and technology angles by her degree in English, and a few short years crafting powerpoint slides for Deloittes.
Rubber stamp the merger, and the clowns of Westminster will be able to announce they have enabled £11bn investment in improving telecoms, any loss of competition won’t matter to them, and any deal costs will just be unloaded on customers.
They need decent regulation that says Yes go ahead with the merger but you’ve got tough milestones on coverage, speed and MNVO pricing.
It seems to me that Vodafone are relying on this going through to boost their 5G coverage. There is no real get up and go on the subject from them.
Areas which had no 5G a couple of years ago still haven’t or have very little, but the other providers are live in that location or have extensive coverage.
They need to pull their socks up as if this merger doesn’t happen and they don’t invest now, they will be left in the dirt.
What we need in the UK is a C-band to be allowed to be rolled out so true 5G can be expanded and experienced. At the moment Three has the fastest 5G speeds I’ve measured at 1.5G fastest I’ve had on Vodafone is 600 meg. If they just allow more poles of wonder to go up then things will improve!
1.5 Gig wow! puts EE to shame
If they’re struggling to deploy 5G on lower, but longer reaching bands, how would using faster bands with shorter range help them take 5G to more people?
We should get the basics right first before going around deploying what’s more or less wi-fi hotspots.
I literally get Gigabit plus speeds with EE so not sure about putting them to shame. Definately will vary area though. Three and EE are generally miles ahead and Vodafone just want in without the effort.
Sounds like a child throwing their rattle out the pram. “If you stop us we’ll stop investing in 5G” – It’s only themselves they’d be harming when people up and leave for EE, O2 or Three!
Three/Vodafone are currently not making a profit on any investment in the UK. Hence why the parent for Three is trying to exit the market by having Vodafone hold options to acquire the whole company down the line. They don’t want to eat the loss (and no one else does either, I imagine) and Vodafone want convergence. Either way at the end of this, we will have 3 providers. If that’s Hutchinson getting tired of putting money into a failing market or if it’s an acquisition, I don’t know until the deal is approved or not.
That happens a lot.
Three have made a huge impact on the UK Mobile telecoms market and it would be a real shame if Vodafone canabalised them as they inevitably will.
Regardless of which operator you use, we can all thank Three for being the only challenger to competition in this market; offering a generally reliable network at a very competetive price and in a simple easy-to-use way.
Just compare the offering for a basic 12-month Sim-Only deal between Vodafone and Three, they are polar opposites.
Three – 25GB for £16/mo – Simple products, clearly presented, no hidden restrictions. Also the cheapest for a mainstream operator.
Vodafone – My god, the Horror of that product line-up!! I can only assume they accidentally productised the result of an MBA Intern ‘creative thinking’ session… from 2009.
I couldn’t decide if my favourite part was having 3 ‘Unlimited’ products with varying degrees of ‘unlimited’, one of which was capped at 2Mbps! Or the ‘3 Xtra benefits’ which include such goodies as ‘picture messaging’ and ‘Device Care’… to give your device a ‘health check’… WTF! It’s also a criminal misuse of the word Benefit too. Only EU roaming could potentially be construed as a benefit… and only if you visit Europe more than once a week EVERY month.
So how much for 25G data, 3 Xtra benefits and an unecessary subscription to YouTube? £39/month!!
The nearest to a ‘pure’ comparable product is the stupidly named ‘Red 20Gb’ tariff at £24/mo. So, 40% more expensive than Three for 20% less.
Vodafone do have a good network and I want to believe they are a good company, but they seriously need to thin out the MBA management types that are running the company to the ground.
Vodafone have been a basket case for two decades – endless badly conceived international M&A (followed by regular chunky writedowns), dreadful customer service, and apparently existing purely to service and pay for their own marketing machine.
Although on customer service, Three are equally poor.
“Thanks to being the only competitor” you mean “thanks for making a loss at a feeble attempt to become profitable and I am very upset there may be some profit made by this merger because I can’t personally benefit”
I use to say anything! this time – no comment!
Typical bully boy tactics. Is 5G really deliver much in the way of real world benefits over 4G? I bet unless you were running Ookla Speedtest most people would never notice the difference.
The latency is the thing you notice most on 5G (imo) but you can definitely tell the speed too, all you need to do is decide to download a video on Netflix or a large app etc
From the phone network with the lowest number of 5G rollout locations (Voda, not three)
Pretty sure o2 takes the crown on that one.
Either way, EEs 5G rollouts include towns with a single mast being upgraded to 5G….
At least Vodafone has decent 5G coverage in the areas it says is does
End of the day, they’re running a business not a charity and if they feel they will miss the Govt’s 5G targets and Ofcom has already warned that on their own that Three and Vodafone are not likely to meet the targets than it should be a warning shot to the Govt that if they expect comprehensive 5G coverage than they have to let this merger go though.
As to the customer at the end of the day, once both networks come together, they will get a much better network experience from Day 1 with better network coverage and speeds for not only their own customers but also MNVOs who use the merged network.
The main issue with any operator missing the 5G targets is not the fault of the operators themselves but rather the short sighted NIMBYs who reject the applications to improve their mobile connectivity, it’s the NIMBYs at councils and residential homes who rather believe conspiracy theories than solid evidence backed up by scientists.
What the Govt ought to do is crack down on those loonies and let the operators crack on with improving coverage for everyone.
Crikey, you are so nieve
This is an attempt by Vodafone to bully the government.
I hope the acquisition fails
NIMBYs are a problem, but Vodafone is simply not trying to expand their 5G network.
They have boring products and boring ideas. Instead of looking outside the box to bring new ideas, they just promoted another old face from inside Vodafone. They’re falling behind on all european markets they operate in. Essentially, they’re bad, they’re in this situation because they’re bad, not because we have 4 networks.
Three gives unlimited plans away for half of what O2 or Vodafone charge. It’s as if they’re trying to keep their profits low so this goes ahead.
Let’s not forget that Vodafone wants this to be approved. They’ll say a lot of BS, don’t fall for it.
I think I’ve accepted the merger will likely be approved, and we are likely to see higher bills long term. This is fine depending on whether the merged co can deliver on 5G SA among other concessions.
We will be in effect a duopoly if VMo2 don’t catch up, hopefully this merger wakes them up
Yeah, higher bills for customers, less competition. what a world we live in, where corporate greed is allowed to happen day in, day out.
99% of UK population to have standalone 5g by 2034? I’d hope to have standalone 9g by then Vodafone!
It’d be NSA 9G probably. Voda has no vision, never has had, never will do.
We need proper competition, not like fixed line where no such thing exists
Since when have any government targets been met on time? They wont be met with or without merger.
On a side note @TimM1 the Raeburn Road (Kettering Rd) Three POW is finally live.
The CMA needs to throw this merger into a busy dual carriageway. It’ll do nothing but damage competition and will impact their customers negatively. Its about glory at being the biggest and some big pay days for the board. Voda’s attempt at bullying the government shows exactly what a bad idea it is, because they know its a “corporate greed” cash grab and nothing more.
Lol, merging both networks can only better the network coverage for it’s customers in much the same way that on their own T-Mobile and Orange on their own were okay but together as EE actually gives a much better network experience which is why they constantly win awards so I can see that Vodafone and Three together will be good.
In most areas, EE as the market leader needs to be challenged and on their own, both Vodafone and Three are nowhere near big enough to take that spot which is it ought to go ahead.
When they finally stop hiding mast’s surrounded by trees things might improve for everyone.
Vodafone need to look at their customer service before anything. Sorry there is only one decent netowkr and thats EE. Three have decent 5g speeds thats it. Merging isnt gonna change shit.
This merger will surely be bad news for the consumer, prices will rise and the service will be worse. Their blackmail tactics are so transparent.