Two of the UK’s biggest names in telecoms are considering a merger to combat the industry behemoths of BT and Sky.
O2 and Virgin Media are reportedly in talks to combine each company’s strengths across TV, broadband, and mobile.
Liberty Global, which owns Virgin Media, is said to be in talks with Spanish O2-owner Telefonica. Virgin Media brings a vast TV and broadband presence to the table, while O2 has a much larger base of mobile subscribers.
Virgin Media currently operates as an MVNO using EE’s network, but is currently due to switch to using Vodafone’s network in late 2021.
The merger, if talks succeed and it passes regulators, would create a new power player that’s more competitive against the existing market leaders.
O2 has sought a merger for quite some time. A £10.25bn bid by Three UK, which would have made the combined mobile giants more competitive against EE and Vodafone, was blocked in 2016 by the European Commission. The commission decided to take control of the inquiry, overruling a request from Britain’s Competition and Markets Authority to decide.
Analysts don’t believe a prospective merger deal between O2 and Virgin Media will face the same problems as the former did with Three.
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