BT-EE Deal to Go Through
The New Year is kicking off exactly how BT would have hoped it would. Their protracted purchase of the UK’s biggest mobile network, EE, now appears to be just days away from getting the rubber stamped approval of Ofcom. Reports coming from insiders within Ofcom suggest that they’re now preparing to wave through BT’s £12.5 billion acquisition, as the regulator dots the I’s and crosses the T’s.
BT are hoping to see the deal go through in March, at which point the UK will have its very first fully integrated “quad-play” company, capable of offering fixed-line phones, mobile, broadband and TV services. There have, of course, been companies offering quad-play deals before (notably Virgin Media), but those have always relied on outsourcing certain aspects (like letting EE run your branded network). It will mean BT will be able to offer these deals at even lower prices than their competition, and offer things like unlimited mobile WI-Fi to EE customers who also take a BT broadband, TV or home phone product. Such an offering would see calls to the 0844 381 6301 EE contact number spike.
The deal will also see BT take control over EE’s 580 high street locations, although the company aren’t expected to ditch the EE branding any time soon, especially as it’s only 5 years old. The biggest impact, however, might come to BT’s Openreach division. Placed in charge of maintaining the UK’s broadband infrastructure by Ofcom in a previous ruling, it’s come under fire for failing to live up to its obligations, and could soon be stripped away from BT and made private, especially since BT will become an even larger player in the broadband sector.
Steven Hartley, an analyst at Ovum, said that the deal is simply the logical next step in the way the UK telecommunications market is going, saying “Look around the world and you’ll find a number of integrated players”.
One such integrated player could soon be Virgin, who have restarted talks with Liberty Global over a “friendly merger”. Such a deal would mean that Virgin would own Liberty Global – one of the world’s largest broadband providers. It would also mean that Vodafone would own Virgin Media, the UK’s second largest pay-tv and broadband provider, behind Sky. It would put the company in an extremely strong position to fight the new BT-EE company, as well as Sky.
Meanwhile, EE has been hit with technical issues in the first week of the year, which have affected customers’ abilities to make phone calls. EE confirmed the issue, saying “Customers of a number of operators have experienced problems calling landlines for a short period. The issue has now been resolved.” Customers might well expect more disruptions and changes to service once BT take over and appoint their own technical and management teams.