EU anti-trust watchdog ponders TeliaSonera/Telenor merger

The European Commission is worried that a proposed merger between TeliaSonera and Telenor would be bad for consumers, and is now pondering whether to approve the deal.

Both companies provide telecoms services in several European countries, but in Denmark the merged entity would face little competition, leaving the public with a choice of only three operators.

"Telecoms constitute an important service in many people’s daily lives. My aim is to make sure that the proposed transaction will not lead to higher prices for Danish consumers and businesses," said Competition Commissioner Margrethe Vestager, herself from Denmark.

The proposed TeliaSonera-Telenor hybrid beast would also be the largest player in terms of revenue and number of subscribers in the country.

The Commish will now spend the next 90 working days investigating what the possible ramifications of such a merger are and will present its decision whether or not to allow it by 19 August 2015.

TeliaSonera and Telenor provide both mobile and fixed telco services in Denmark, as well as broadband and television services.

TeliaSonera provides mobile telecoms services under its main brand Telia, as well as under two sub-brands, Call Me and DLG Tele. Telenor provides mobile telecoms services under its main brand Telenor, and sub-brands CBB Mobil and BiBoB.

The Commission was notified about the planned deal on 27 February 2015.

The GSMA, the association that represents nearly 800 mobile operators, called last December for the Commission to be less strict on mergers.

Despite the Commission’s anti-trust arm worrying that mergers reduce consumer choice and push up prices, GSMA director Anne Bouverot said: “There is little evidence that markets with four operators have lower prices (over the long term) than those with three.”

The GSMA called on competition authorities to “more readily consider the advantages of mobile mergers and in particular the long-term benefits they can deliver to consumers”, and rely less on existing pricing analysis. ®