The proposed merger of Orange and T-mobile will create the UKs largest mobile phone company serving a total of 28 million customers, swiftly relegating O2 and Vodaphone to second and third place in the market. In the immediate future, this could spell good news for consumers and should serve to create fierce competition amongst, what will become, three major providers. However, going forward this completely changes the landscape of mobile phone industry in the UK, with just three organisations dominating around 90% of the industry.
Jason Glynn, communications expert at uSwitch.com, comments: “On the surface this could be perceived as fantastic news for mobile phone customers in the UK. Merging these two companies will ‘plug the network gap’, ultimately providing a flawless network coverage across the country for these consumers. With a combined 37% market share, this new major player will now have every opportunity to provide some really competitive deals and give the UKs lethargic mobile phone industry the wake-up call it needs.
“Generally speaking, having just three organisations dominating 90% of one sector is not always a positive move. However, the mobile phones sector is one of the few that will actually benefit from this. This new organisation will not have to make huge investments into customer acquisition and all funding can be ploughed into investment into new services, exploiting new technologies and competing more aggressively with O2 and Vodafone. T-Mobile has been struggling to compete against its larger rivals for some time and last month admitted it had lost 87,000 UK customers in the three months to the end of June so this couldn’t come at a better time for them.
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