Eurobites: Ofcom Sounds Alarm on O2 Deal

Also in today's EMEA regional roundup: Vodafone barges in to BT/Openreach row; Deutsche Telekom on Safe Harbor backwash; AlcaLu supplies LTE for aviation network.

  • The head of UK telecom regulator Ofcom has hinted that her organization might not support the proposed takeover of Telefónica UK Ltd. (O2) by Hutchison Whampoa Ltd. (Hong Kong: 0013; Pink Sheets: HUWHY), according to a BBC report. Sharon White, Ofcom's chief executive, said in a speech in London on Wednesday that "four operators is a competitive number," adding that "Ofcom's experience is that competition, not consolidation, drives investment and delivers low prices." The UK's Competition and Markets Authority has already told the European Commission that it wants to thoroughly examine the proposed takeover. (See Eurobites: UK Wants Closer Look at Hutchison/O2 Deal and Telefónica Seals $15.2B O2 Sale to Hutchison.)

  • In similar territory, Vodafone Group plc (NYSE: VOD) is muscling in on the debate about whether BT Group plc (NYSE: BT; London: BTA) should be split up from its Openreach access division, reports the Financial Times (subscription required). Vodafone is making a submission to Ofcom as part of the regulator's consultation on the proposed break-up in which the mobile giant argues that BT made £6.5bn in "excessive profits" in the past decade from its Openreach division. This would seem to put Vodafone at odds with the UK's minister for the digital economy, Ed Vaizey, who let it be known last week that such a separation would have "lots of potential to backfire." (See Eurobites: UK Minister Cool With BT/Openreach Relationship.)

  • Deutsche Telekom AG (NYSE: DT) has voiced its approval of the European Court of Justice's decision to overturn the so-called Safe Harbor agreement on data transfer between the European Union and the US. In a statement, Deutsche Telekom's Thomas Kremer said: "This ruling is an important step for data privacy and protection in Europe," adding that the Safe Harbor agreement "is not viable in its current form." The German incumbent has been at the forefront of the debate about data privacy, and has even mooted the idea of a a Schengen Area Internet and Germany-only email systems. (See Euronews: Prism a Wake-up Call, Says DT.)

  • Alcatel-Lucent (NYSE: ALU) is to supply the LTE technology for the European Aviation Network (EAN) being launched by Deutsche Telekom and satellite operator Inmarsat plc (London: ISAT). EAN, consisting of an LTE ground network component combined with a satellite network component, will allow passengers to use WiFi-enabled devices for mobile data access as they make the transition from ground to air, without any interruption in service.

  • Spanish giant Telefónica is extending its strategic partnership with Russian operator MegaFon , an agreement which began life in 2013. The companies have collaborated in a range of areas, including the procurement of equipment and the exchange of best practices.

  • Nordic operator Telia Company has appointed Sören Abildgaard acting head of its newly combined Group Commercial and Group Technology unit. The move could be seen as one of the after-shocks of the operator's decision to pull out of Eurasia and concentrate instead on its European interests. (See TeliaSonera to Quit Eurasia, Focus on Europe.)

    — Paul Rainford, Assistant Editor, Europe, Light Reading

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