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Three to buy O2 Ireland for €780 million

124

Comments

  • Moderators, Education Moderators, Technology & Internet Moderators Posts: 35,033 Mod ✭✭✭✭AlmightyCushion


    clohamon wrote: »
    Pretty much spot-on by the Irish Times, except...



    I can't see how they can just dump 50,000 customers without their permission.

    Still no news on the Vodafone/Three network agreement.
    Still no news on whether the NBS masts must be retained.

    It's happened before. Didn't Vodafone buy BT's customer base a few years back. As long as the terms of their contract are kept the same, it won't affect customers.


  • Registered Users Posts: 32,417 ✭✭✭✭watty


    Also TalkTalk in Ireland.

    This is another example of why the "competition" Mantra distorts Regulatory decisions and it's less appropriate to anything with a fixed small amount of resource than say Milk, Tyres or Baked Beans production, or services such as Insurance, Pensions, Mortgages, Credit Cards.


  • Registered Users Posts: 1,755 ✭✭✭clohamon


    It's happened before. Didn't Vodafone buy BT's customer base a few years back. As long as the terms of their contract are kept the same, it won't affect customers.


    There’s about 4,900,000 mobile subscriptions excluding ‘broadband-only’ subs. Three have 6.2% of them at Q4 2012 - that’s 304,000 subs

    If Three are only offloading 50,000 then they will be hanging onto most of their customers, so the question remains - how do they choose the lucky/unlucky ones?

    AFAIR the Vodafone BT thing was when BT had decided to exit the retail market altogether, so there was no question of choosing between customers.


  • Registered Users Posts: 1,467 ✭✭✭Heraldoffreeent


    clohamon wrote: »
    There’s about 4,900,000 mobile subscriptions excluding ‘broadband-only’ subs. Three have 6.2% of them at Q4 2012 - that’s 304,000 subs

    If Three are only offloading 50,000 then they will be hanging onto most of their customers, so the question remains - how do they choose the lucky/unlucky ones?

    AFAIR the Vodafone BT thing was when BT had decided to exit the retail market altogether, so there was no question of choosing between customers.

    According to the article quoted above, It's 50,000 O2 customers that will be flogged to UPC. in that scenario, I'd imagune they'll look for readymade, easy to dislodge customers. The telefonica MVNO base 48months looks the most likely. I'm not sure if they have that many subscribers, but that plus some low performing PAYG customers would be my guess.


  • Closed Accounts Posts: 9,088 ✭✭✭SpaceTime


    They might flog 48 Go Conquer or whatever it's called.

    I'd say they've about 50,000 subs?

    It'd be a poor strategic fit for UPC though who would want multiplay / triple play customers i.e. bill pay people mostly to work with their cable, telephony and broadband offerings.

    They're also a youth market focused brand, which again doesn't fit UPC's profile which would mostly be householders.

    I can't really see UPC wanting primarily prepay.

    They could hive off a group of people on one particular bill pay plan too. Nothing to prevent them doing that. So, perhaps 50,000 people on some unlimited package or something get sold to UPC?

    I'd suspect they'll try to off load less profitable Three bill pay customers.

    If I were them I'd do this:

    1) Offload some aspect of Three Ireland to UPC.
    2) Get rid of 48 months and merge it back into the general prepay package. Its just an advertising overhead and unnecessary sub brand. I find the whole brand totally confusing.
    3) Try and leverage the O2 brand as much as possible for as long as they can get away with it as Three has a very limited reputation in the business market.

    It would be fantastic though (for me) if UPC Mobile offered cheap/free roaming on UPC NL and Telenet in Belgium.


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  • Registered Users Posts: 1,467 ✭✭✭Heraldoffreeent


    I don't think either Three or UPC really care about the 50K users. What I've heard from some of the interested parties is that UPC are happy for the deal to go over the line.
    UPC and Three have been negotiating the MVNO agreement since early 2012 and UPC have no intention of becoming an MNO in any shape or form in Ireland as its too small a market and the cost of deploying an anyway decent network relative to that is too high.

    As for the quadplay proposition, well yes they do want to offer that, but what they really want to do is add 30-50 euro per month to as many bills as they can as quickly as possible and as cheaply as possible, thats the bottom line. The fact that this kind of offering also protects their base from Eircom and Voda is also part of their stratagy.

    The EU stuff is just window dressing to get the deal done.


  • Registered Users Posts: 4,046 ✭✭✭bealtine



    As for the quadplay proposition, well yes they do want to offer that, but what they really want to do is add 30-50 euro per month to as many bills as they can as quickly as possible and as cheaply as possible, thats the bottom line. The fact that this kind of offering also protects their base from Eircom and Voda is also part of their stratagy.

    The EU stuff is just window dressing to get the deal done.

    Sounds about right to me...


  • Closed Accounts Posts: 9,088 ✭✭✭SpaceTime


    Three will do whatever they have to to push this over the line, there's no question about that.

    UPC would be mad not to look for a lot of freebees :D


  • Registered Users Posts: 4,046 ✭✭✭bealtine


    Deal seems to be cleared by the EU now
    http://europa.eu/rapid/press-release_MEMO-14-387_en.htm


  • Registered Users Posts: 1,755 ✭✭✭clohamon


    bealtine wrote: »
    Deal seems to be cleared by the EU now
    http://europa.eu/rapid/press-release_MEMO-14-387_en.htm

    Silo'd bandwidth (lower speeds) and reduced coverage. It's a useless decision.

    The Commission seems to think reduced coverage in rural areas is a good thing - more 'efficient' they say - i.e. more profitable for networks.
    The Commission found that the merger would have brought limited efficiencies in relation to broadband access in isolated rural areas of Ireland where Three - currently the beneficiary of the National Broadband Scheme - may have decommissioned some loss-making sites upon expiry of the scheme. However, it is clear that such limited efficiencies could not counter the harm that consumers would suffer from the elimination of the retail competition between Three and O2 and the reduction in overall competitive pressure on the Irish mobile telecoms market.


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  • Closed Accounts Posts: 9,088 ✭✭✭SpaceTime


    Making sure the MVNO market is open is a really big deal though.

    Tesco in particular had a very big impact.

    I wonder what's going to become of them now given that O2 (their partner network) is now 3...


  • Registered Users Posts: 1,467 ✭✭✭Heraldoffreeent


    SpaceTime wrote: »
    Making sure the MVNO market is open is a really big deal though.

    Tesco in particular had a very big impact.

    I wonder what's going to become of them now given that O2 (their partner network) is now 3...

    They, and UPC, are the two MVNO's mentioned, for whom 30% of the network is being made available.
    Whats not mentioned in this is how much TMI and UPC will pay for this access. The normal process to date has been cents per mb, text and minute wholesale, with this it seems the two MVNO's will pay a flat fee per annum. Theres no mention of how thats to be regulated or what mechanism will be used to calculate a fair price.


  • Closed Accounts Posts: 9,088 ✭✭✭SpaceTime


    They, and UPC, are the two MVNO's mentioned, for whom 30% of the network is being made available.
    Whats not mentioned in this is how much TMI and UPC will pay for this access. The normal process to date has been cents per mb, text and minute wholesale, with this it seems the two MVNO's will pay a flat fee per annum. Theres no mention of how thats to be regulated or what mechanism will be used to calculate a fair price.

    Yeah, it's a little too vague although it is only a memo. I'd like to see the full report before I cast judgment.
    I am guessing though that ComReg may be given the role of coming up with that price? It seems like the only logically placed body to do that.


  • Registered Users Posts: 32,417 ✭✭✭✭watty


    clohamon wrote: »
    Silo'd bandwidth (lower speeds) and reduced coverage. It's a useless decision.

    The Commission seems to think reduced coverage in rural areas is a good thing - more 'efficient' they say - i.e. more profitable for networks.

    Earlier today I noted the deal will result in lower capacity, lower coverage.

    I only implied a poorer service. Problem is there is no genuine monitoring and enforcement of standards by Regulator, nor good enough licence conditions in the first place. Too much emphasis on "Competition" and not enough on good use of a limited National Resource and technical competence.


  • Registered Users Posts: 4,046 ✭✭✭bealtine


    Amazing even Comreg are not too happy:

    http://www.comreg.ie/_fileupload/publications/ComReg1453.pdf

    "ComReg remains concerned that, given the substance and form of the Final Commitments, the EC’s competition concerns will not be fully addressed, and that significant negative consequences for Irish consumer welfare may result. In that regard, ComReg’s primary concerns with the Final Commitments are, in summary, as follows:
    they appear inadequate and ineffective to address the serious competition
    concerns and consumer harm identified by the EC (for example higher
    prices);and
    they do not appear to comply with the EC’s requirements as set out in its
    Remedies Notice."

    "ComReg remains of the strong view that the behavioural
    commitments are insufficient to address the structural competition deficit
    identified as likely to result from the Proposed Acquisition."


  • Registered Users Posts: 4,046 ✭✭✭bealtine


    I guess the name is fortuitous : Chinese billionaire Li Ka-shing. Thanks EU Li Ka-shing is going Ka-ching all the way to the bank


  • Closed Accounts Posts: 9,088 ✭✭✭SpaceTime


    bealtine wrote: »
    Amazing even Comreg are not too happy:

    http://www.comreg.ie/_fileupload/publications/ComReg1453.pdf

    "ComReg remains concerned that, given the substance and form of the Final Commitments, the EC’s competition concerns will not be fully addressed, and that significant negative consequences for Irish consumer welfare may result. In that regard, ComReg’s primary concerns with the Final Commitments are, in summary, as follows:
    they appear inadequate and ineffective to address the serious competition
    concerns and consumer harm identified by the EC (for example higher
    prices);and
    they do not appear to comply with the EC’s requirements as set out in its
    Remedies Notice."

    "ComReg remains of the strong view that the behavioural
    commitments are insufficient to address the structural competition deficit
    identified as likely to result from the Proposed Acquisition."

    That's very interesting. ComReg seems to be a little unhappy with the decision. Surely the Irish Competition Authority would have been a more appropriate entity to rule on this merger? The European one is only really concerned about things that impact dramatically on intra-EU stuff. Hence, their concern about Aer Lingus / Ryanair as it was impacting on multiple countries (IRL + UK in particular but also flights into Ireland from other EU countries)


  • Registered Users Posts: 4,046 ✭✭✭bealtine




  • Registered Users Posts: 15,452 ✭✭✭✭The Cush




  • Registered Users Posts: 3,884 ✭✭✭cgarvey


    SpaceTime wrote: »
    Surely the Irish Competition Authority would have been a more appropriate entity to rule on this merger?

    Yup. The release even has that question in there. They provide 2 paragraphs of guff without answering the question, though!


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  • Closed Accounts Posts: 1,260 ✭✭✭Rucking_Fetard




  • Closed Accounts Posts: 150 ✭✭_Jumper_


    Off buying O2 UK for £9 Billion now.

    techworld.com/news/networking/three-in-talks-buy-o2-from-telefonica-for-up-9bn-3594749/


  • Registered Users Posts: 32,417 ✭✭✭✭watty


    Oh dear. Poor them.


  • Closed Accounts Posts: 5,019 ✭✭✭ Casen Orange Slipknot


    I see the store rebranding is well underway.


  • Registered Users Posts: 5,532 ✭✭✭JTMan


    Which stores have you noticed a rebrand on?


  • Registered Users Posts: 76 ✭✭abyss


    Anyone know if there is a chance O2 base stations will be working with 4G(three) soon? I mean - if they can be upgraded to 4G system. I've read notice from County Council there will be some improvement done on O2 BTS near me, but there is a no more technical information.


  • Registered Users Posts: 1,931 ✭✭✭ItHurtsWhenIP


    abyss wrote: »
    Anyone know if there is a chance O2 base stations will be working with 4G(three) soon? I mean - if they can be upgraded to 4G system. I've read notice from County Council there will be some improvement done on O2 BTS near me, but there is a no more technical information.

    I'm wondering this myself. I only get Edge from O2 at home, but there is good 3G coverage from Three in the area.


  • Registered Users Posts: 10,905 ✭✭✭✭Bob24


    abyss wrote: »
    Anyone know if there is a chance O2 base stations will be working with 4G(three) soon? I mean - if they can be upgraded to 4G system. I've read notice from County Council there will be some improvement done on O2 BTS near me, but there is a no more technical information.

    I don't think there has been any clear announcement from Three, but I certainly hope so.

    O2 was getting ready for a 4G roll-out and put that on hold after the buyout announcement. It is probably taking a bit of time because Three doesn't want to flick the switch for O2 customers only and needs to merge their infrastructure with O2's first - but I think once this is done they will be able to roll-out a much better 4G coverage very quickly.


  • Registered Users Posts: 1,755 ✭✭✭clohamon


    Bob24 wrote: »
    I don't think there has been any clear announcement from Three, but I certainly hope so.

    O2 was getting ready for a 4G roll-out and put that on hold after the buyout announcement. It is probably taking a bit of time because Three doesn't want to flick the switch for O2 customers only and needs to merge their infrastructure with O2's first - but I think once this is done they will be able to roll-out a much better 4G coverage very quickly.

    The coverage obligation in their (O2 and Three and Vodafone) liberalised-use licences is 35% of population, or 0.36% of the national territory. There is no obligation to provide any particular technology; it can be 2g, 3g or 4g.


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  • Closed Accounts Posts: 9,088 ✭✭✭SpaceTime


    They will have to announce 4G for O2 customers soon as they're going to lose out to Vodafone and Meteor if they don't.
    The licence is one thing, the market reality is that the other networks have growing 4G coverage.


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