UK Mobile Network- What’s Happening
The UK mobile market has gone through a vast amount of change over the last 15 years and now we are expecting more changes on the horizon. Just over a year ago, the two mighty forces of Virgin Media O2 came together in a £31 billion pound deal to become one of the largest telecoms companies in the UK. At the time of the merger, O2 had 34 million mobile users and Virgin Media had 5.3 million customers, combined; now making them one of the largest telecoms companies in the country. Together, Virgin Media O2 plan to invest a minimum of £10 billion over the next five years.
In a recent interview, global technology market research firm Counterpoint shared their views on the changing landscape. They said, “a recent study by RootMetrics revealed that all four major UK mobile operators, including Virgin Media O2, improved download speeds, reliability and latency of their networks in the first half of 2022.” Furthermore, IDC research manager Richard Thurston is more certain on the merger’s success.“We’ve seen Virgin Media O2 win deals in mobile private networks, which is a significantly growing market, and one which we are excited about because of the multitude of use cases and the innovation in this space,” he says.
Three and Vodafone to merge
As many may have seen in the press, there is a regulatory approval pending on a merger between Vodafone and Three. It is clear to see the motivation for joining forces as teaming up would bring growth as well as offering many synergies and cost-saving opportunities. Perhaps some see it as hard for Three or Vodafone to keep up the pace against the monster rivals of Virgin Media O2 and BT/EE based on size alone.
Earlier in the year, Vodafone’s chief executive Nick Read had spoken on why we need for more consolidation within the telecoms industry. He said that merged businesses could be attractive to investors and that there is a case for Vodafone to consolidate in the UK, Italy and Spain.
5G continues to be a driver as telecom operators need to invest heavily in the necessary networks and infrastructure. M&A with a focus on improving operational efficiency can make it happen. Mergers are a unique opportunity to revamp operating models and bring the kind of transformative results that can make shareholders happy and take the company into the next generation of technology. Mergers are, of course, complex endeavours, considering the number of tasks and each one’s interplay, so efficiency initiatives must be carefully planned and organised.
Overall, there are positive and potential benefits for a more consolidated telco space could be more focus with investment, a larger budget to improve the network, infrastructure and overall, an even better experience for customers. The fact is, for many within the telecom industry, consolidation remains the most logical move—to increase economies of scale and boost efficiency. But to make those deals work, you’ve got to do it right.