EU commish: We smacked down O2/Three but we didn't take it 'lightly'

Calls on consumers to submit evidence in crusade for greater competition

European flag with sad face

EU competition commish Margaret Vestager reckons the decision to smack down the proposed £10.5bn merger between O2 and Three this week was one it did "not take lightly".

The decision to block the deal this week came as little surprise to most. Along with Ofcom, the EU has been vocal about its concerns over the deal - mainly that reducing the number of mobile operators in the UK would have a negative impact on consumers.

However, Three's owner, CK Hutchison, has said it is considering taking legal action over the decision.

Questions have also been raised as to why this deal was halted when BT's £12.5bn acquisition of EE was waved through.

Speaking at consumer body the Bureau Européen des Unions de Consommateurs (BEUC), Vestager said: "Competition policy isn't there to defend the competitors of a powerful company. It isn't there to help one company, and hold back another. It's there to defend consumers.

She said "Earlier this week, we decided to block a merger between two UK mobile operators, Three and O2. We didn't take that decision lightly. The EU has had merger control rules for more than 25 years, and this is only the twenty-fifth time we have blocked a merger."

She said: "For many years, British mobile customers who felt they were getting a raw deal from the bigger players have been able to “cross the street” to Three. Its prices have been much lower. And on a number of occasions, it has kept them that way even when its rivals tried to raise prices.

"So taking Three out of the picture would have seriously hurt consumers' freedom to choose."

The commission has also issued a formal statement of objections against Google, accusing the giant as flinger of anti-competitive behaviour.

Europe has form for going after big tech companies. In 2008, it decided that chipmaker Intel had tried to push its rival AMD out of the market by offering deals to computer makers and retailers that AMD had no chance of matching. That resulted in a €1.06bn fine for Intel.

Vestager said: "It might seem strange to talk about choice when it comes to Internet searches. Google has a market share of about 90 per cent in Europe - and in some EU countries, the figure is more than 97 per cent.

She said: "There’s always the chance that someone will come up with a search engine that people will prefer over Google. And it's that possibility that drives both Google and its competitors to keep innovating.

"That's why we're concerned that Google might have used its power to limit people’s choices."

Vestager ended her speech by calling for consumers to help her crusade for greater competition.

"I know it’s a big commitment to get involved in a competition case. These cases call for a lot of detailed evidence – in the Intel decision, it took more than 500 pages to set out all the arguments and to give the Commission’s view of them." ®




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