Vodafone and Three pledge £11 billion investment over next decade

The combined Vodafone and Three network will invest €11 billion over 10 years to create the UK’s biggest network and boosting economic growth and employment.

Three UK CEO, Robert Finnegan, and Vodafone UK CEO, Ahmed Essam (main pic) have put more flesh on the bone of the historic merger.

Both confirmed there will be no change to each operator’s pricing strategy and that a multi-brand strategy will continue with Vodafone and Three continuing under their own names .

No change to each operator’s pricing strategy and a multi-brand strategy will continue

Economies of scale will enable the UK’s new third network to bring 5G coverage to more than 99 per cent of the population by 2034 and similar geographic coverage by 2027.

They claim that the UK businesses’ digital transformation will get a boost with improvements to production efficiency from full 5G access while energy consumption will be reduced by enabling business to install more energy efficient 5Ge smart technology to reduce their emissions?

“The merger creates a third network operator with scale and creates more effective competition to the market leaders to become an even more effective challenger on home broadband, accelerating the availability of fixed wireless access to complement the UK’s fibre footprint” said Essam.

Both of the businesses will compete as usual on a stand-alone basis until the merger is complete. So customers should not expect any changes to their plans and prices, They have pledged continuation of support on social tariffs to ensure there are o price rises on these tariffs. In the contract-free market there will be no price rises.

Finnegan said he was confident the regulatory bodies would not stop the merger.

“Ofcom identified that investment is very important in the industry. We’re both investing more than we are generating and that is not sustainable. I think Ofcom and the CMA recognise that and that this is an opportunity to correct what is a dysfunctional market. This is a way of creating a really strong third player that has scale and is wiling to invest £11 billion which is way more than any of the other operators. And that’s got to be good for consumers, The devil is in the detail, We will be engaging with the CMA in due course and listen to what their concerns are and move forward.”

this is an opportunity to correct what is a dysfunctional market.

Added Essam added: “If you reflect on where the market was five years ago and where we are today clearly it is a very different market. What materially changed is the MVNO market which is competitive. MVNO’s enjoy a market share of more than 16.5 per ent. It is very different from the position five years back. This changes the competitive landscape and makes our case very strong and which will bring our transaction over the claiming weeks to the CMA”.

The Three China connection is not seen as an obstacle for security concerns as it did with Huawei.

“We work with the security bodies and they have no concerns about our operations. This will be Hutchison taking a 49 per cent stake. So we don’t see an issue here”, said Finnegan.

Essam emphasised that both networks are already heavily regulated in the UK and adhere to strict compliance on customer data.

“We both abide by customer privacy regulations, Clearly the deal will be subject to national security approvals. We are on a good position to take this case to the security agencies and bodies”