The biggest mobile network the UK has ever seen is about to launch, as after 18 months of consideration, the Competition and Markets Authority (CMA) has approved a merger between Vodafone and Three, in a deal worth £16.5 billion.
This combined network will have 27 million customers, making it slightly bigger than EE’s 25 million, so it’s set to be a huge force in the UK’s mobile landscape. Here’s everything you need to know.
The merger is expected to formally complete in the first half of 2025, so at the time of writing there’s between roughly one and seven months to wait still.
The CMA has required Three and Vodafone to deliver on a joint network plan, which would see the merged company invest £11 billion into improving their combined network over the next eight years.
On top of that, the combined network is also required to cap select tariffs and data plans for three years. These caps would also apply to the network’s sub brands like VOXI and Smarty, and would ensure both current and future customers are protected from price rises. However, exactly which plans would be selected for these caps is unclear for now.
Finally, the CMA is requiring this merged network to offer pre-set prices and contract terms to MVNOs (mobile virtual network operators) for three years. MVNOs are all the networks that don’t have their own spectrum, so the likes of Lebara and Tesco Mobile. In other words then, this condition means those sorts of networks should be able to access this new merged network’s coverage with competitive pricing and terms.
It’s too soon to say what will happen after three years, though as most of the CMA’s terms expire after three years there may be some changes.
In addition, Vodafone – which will own 51% of the combined network’s equity at launch – will have the option to buy the remaining 49% after three years, “subject to certain conditions.”
From what Vodafone and Three are saying, and given that they’ve committed to investing £11 billion into network improvements, this merger is likely to be good news for the UK’s 5G rollout.
The CMA has said that this will “help enhance the UK’s 5G capability”, while Vodafone has said that this “new advanced 5G network will bring vastly superior network quality to tens of millions of consumers and businesses up and down the country”, and that it will “create one of Europe’s most advanced 5G networks”, reaching 99% of the UK population.
The name of this combined network hasn’t yet been announced. It may simply combine the two names into ‘Vodafone Three’ or similar, much as we saw with ‘Virgin Media O2’, but that remains to be seen.
One obvious potential beneficiary of this merger is O2, as Vodafone and O2 recently extended their long-standing network sharing agreement.
So with Vodafone merging with Three, that essentially means O2 will have a network sharing agreement with Three as well, and should also benefit from the further investment Vodafone and Three will pump into their combined mega network.
Vodafone has argued that as a result, the new network will benefit over 50 million customers (in other words all of Vodafone’s, Three’s, and O2’s customers).
This merger could be good for competition, as while it will mean one less major player, it will give the new combined entity the might to better compete with EE, which until now was the UK’s largest mobile network.
The CMA has stated that subject to the merged network implementing its network improvements plan, it “would boost competition between the mobile network operators in the long term, benefiting millions of people who rely on mobile services.”
Margherita Della Valle, Vodafone Group’s CEO, has similarly said the merger will be “great for customers, great for competition and great for the country.”
