Vodafone warns BT about market dominance as it finalises £12.5 billion EE takeover
Vodafone boss Vittorio Colao has warned that BT's £12.5 billion takeover of mobile giant EE would have to be policed closely by regulators to ensure fair play for rivals.
“BT will have to behave very well,” he warned. “As soon as the incumbent becomes such a large player in all parts of the market the temptation to become restrictive is high.”
The day before final bids have to be in for Premier League football rights with BT again head-to-head with Sky in a potential £4 billion auction, Colao said rivals must be guaranteed access to content like goal clips at affordable prices.
He said: “Exclusivity and lack of access to content could suffocate the market. The potential for BT and other incumbents like Telefonica to squeeze margins for their competitors is very tempting.”
BT sealed its takeover of EE, which will see Deutsche Telekom and France’s Orange take 12% and 4% stakes in BT. The deal is also partly being financed through a £1 billion share placing.
Gavin Patterson, BT chief executive, said splashing the cash on EE would not affect his ability to bid for the Premier rights.
He said: “This is a major milestone for BT as it will allow us to accelerate our mobility plans and increase our investment in them.”
He also denied that BT would be dominant in the UK market. “We have a third of the fixed-line market and will have a third of the mobile market.
“This deal does not concentrate the market any further and we are still a very small player in the content market.”
EE is the biggest mobiles provider in the UK with 24.5 million customers, of whom 7.7 million are on 4G.
But that would be eclipsed by Three owner Hutchison Whampoa’s planned £10 billion takeover of O2, which would have a combined base of more than 33 million customers.
BT said the takeover of EE could take more than a year to complete.
Vodafone also reported slightly better-than-expected revenues for its third quarter with the UK returning to growth for the first time in 15 quarters.
