Analysts React To Three / O2 Deal As Dixons Carphone Announce New MVNO

Business / Tech

UK mobile network Three are certainly not shy of the limelight, but over the past couple of weeks they have been seeing a lot more of it than even they are used to. The news of parent company Hutchison Whampoa Ltd’s take over bid for O2 has seen Britain’s smallest network go from the underdog to the possible new big boy, and there is now confirmation of a deal with Dixons Carphone.

News of the proposed MVNO from one of Europe’s largest consumer electronics business will go a long way to give Three a boost in confidence as HWL begin the lengthy process of negotiating and processing the acquisition of O2 from owner Telefonica.

Dixons Carphone announced they are to launch a MVNO, currently unnamed, on the Three network with the aim of offering “innovative and highly personalised connectivity” to customers purchasing connected devices from it’s PC World, Dixons or Carphone Warehouse stores.

Graham Stapleton, CEO of Carphone in the UK and Ireland said the launch of it’s MVNO would be key to its goal of offering the widest range of connections to customers. Confirmation on prices and tariffs are yet to be confirmed.

The news comes as analysts react to the potential O2/Three merger with a largely positive opinion. Some have pointed to Europe’s trend of coming down to three networks, with Ovum analyst Steven Hartley referring to it as “the magic number” and that “it was always natural that it was going to settle down” to such a number.

Others have pointed toward the boost it will give Three, still a relative newcomer to the industry since its inauguration in March 2003. Imran Choudhary, consumer insight director at Kantar Worldpanel ComTech, pointed out the good timing of the move.

“Three has grown over the years but growth has slowed… in the past it may have been just trying to make its mark but now its a case of guaranteeing its future survival.”

Others pointed out the issues that could lie ahead with the logistics of the deal, with some pointing out that Three would come under “significant scrutiny from Ofcom” and the European Commission, and others remarking on the possible rise in prices that could be a result of less competition in the market.

To Top