European Commission objects to acquisition of Tele2 by T-Mobile

The European Commission has concerns about the acquisition of Tele2 by the Dutch branch of T-Mobile. There wouldn’t be enough competition left. If the merger took place, the number of telecom providers with their own network would decrease to three.

That’s what Deutsche Telekom, T-Mobile’s parent company, reports today. The European Commission’s main concern is that a merger would lead to higher prices for consumers. This is because of the lack of competition. Of course, the two companies do not agree with this analysis.

Enabling investments

As far as T-Mobile and Tele2 are concerned, the merger of the two companies could, on the contrary, lead to additional innovation. It would also give Dutch consumers more choice through a wider range of products. For example, the two companies could jointly invest in the roll-out of a 5G network in the Netherlands.

This is a substantial investment, which will enable the companies to suffer better together. At the same time, however, the European Commission wonders whether this would not lead to higher subscription prices. The Commission has now lodged this objection with the companies, focusing on the concern that prices will eventually rise.

Busy campaign

T-Mobile is doing its utmost to obtain the Commission’s approval for the merger. It has already made five pledges to that effect. It was the first company in the Netherlands to realise a 5G network. Consumers could also enjoy an unlimited subscription for €25 per month for at least the next three years.

Other promises relate to fibre optics, faster internet networks and consumer freedom of contract. The company is currently reflecting on the European Commission’s concerns and is in a position to respond to them. A decision is expected on 30 November.

We were already questioning the announcement of the takeover and talking about a farce. The background article can be read back by clicking here.