The UK divisions of mobile operators T-Mobile (Deutsche Telekom) and Orange (France Telecom) have entered into exclusive negotiations that will result in a new 50:50 joint venture company. It could also disrupt the debate over freeing up 900Mhz (2G) radio spectrum for use by 3G ( HSPA ) and future 4G ( LTE ) Mobile Broadband services.

The new operator will hold a 37% share of the UK market, a combined mobile customer base of roughly 28.4m and around £8.2bn in sales. It will also save money by not requiring as many base stations to operate the same service.


However there are concerns that the move could hamper T-Mobile's existing network sharing agreement with Three (3) UK. It might also complicate the current talks aimed at freeing up O2 and Vodafone's 900Mhz 2G spectrum for use by future 3G and 4G Mobile Broadband services.

In reality we suspect that the 900Mhz debate will not be as complicated as it could have been because neither T-Mobile nor Orange have their own 900Mhz. It would have been much worse had either O2 or Vodafone got in on the action. Still the situation could cause further delays to a process that had recently appeared to be speeding up (here).

Unlocking the spectrum is seen as crucial for the success of Digital Britain, which seeks a new Universal Service Commitment (USC). This USC aims to make broadband speeds of 2Mbps available to everybody in the UK by 2012 (original news) and Mobile Broadband is very important for achieving that goal.