The merger of two Dutch telecom providers, T-Mobile NL and Tele2 NL, has been given the green light by the European Commission after the two announced their merger plans in December 2017.
The EU Competition watchdog was initially worried about the new competitive status of the sector in The Netherlands if the merger would be given the go-ahead. Their concerns, however, were later dropped and the oversight committee has given its permission after both companies agreed to a promise to maintain cheap data bundles and vowed to be the first joint provider to have a nationwide 5G network.
T-Mobile NL and Tele2 now own a quarter of the Dutch mobile market. The former provides telecommunication services to private and business customers in The Netherlands and owns a mobile network with nationwide coverage over which it provides 2G, 3G, 4G, and NarrowBand-Internet of Things (NB-IoT) mobile communication services.
It also provides retail fixed services, including broadband Internet, TV, and fixed telephony services based on wholesale access services, while Tele2 NL operates as a 4G-only mobile network operator, providing voice, data and messaging services, and also fixed broadband services to the Dutch public
Søren Abildgaard, the CEO of T-Mobile NL, is pleased with the decision of the European Commission. “We can now fulfil our promises made in the area of accelerated introduction of 5G and ensure that fibre is available,” he said.
Tele2 NL took the opportunity to become the fourth telecom player in the Dutch market, leading the price per gigabyte of mobile data to fall sharply ever since the company’a arrival as a provider in 2015.
As to whether the price will now rise, according to a wide range of investigative measures, and feedback from market participants in the Dutch telecommunications sector, as well as other stakeholders, the European Commission thinks that the situation will not be problematic for consumers.
The investigation found that the proposed merger was unlikely to lead to significant price increases because of the limited combined market position (around 25% market share) and the relatively small increment brought by Tele2 NL (around 5%). Furthermore, there are uncertainties concerning Tele2 NL’s role as an important competitive force in the Dutch market.
The Commission also concluded that the transaction would not increase the likelihood of coordinated behaviour between mobile network operators because the other two mobile network operators, KPN and VodafoneZiggo, “have different strategies and incentives largely based on cross-selling mobile services to their fixed customer base.”
Third, the Commission found that any potential change in conditions for virtual mobile network operators due to the proposed merger would not have a serious impact on the level of competition in the Dutch mobile telecoms market, concluding overall that the proposed merger was unlikely to significantly impact the level of service or prices paid by Dutch mobile telecoms customers.
As a result, the Commission concluded that any potential change in the conditions for virtual mobile network operators due to the proposed merger would not have a serious impact on the level of competition in the Dutch mobile telecoms market, concluding overall that the proposed merger was unlikely to significantly impact the level of service or prices paid by Dutch mobile telecoms customers.
Furthermore, the transaction would not raise competition concerns in the European Economic Area or any substantial part of it and cleared the case unconditionally.