O2 and Virgin Media in talks to merge

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Posted 4th May
bbc.co.uk/new…804

Hopefully that doesn't happen. That can't be good for any consumer.
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Not good? How so? They don't have a significant overlap in services, so not as if competition is reducing.

I am expecting more such mergers to happen across industries as companies try to survive and cut costs.
Edited by: "bozo007" 4th May
bozo00704/05/2020 16:51

Not good? How so? They don't have a significant overlap in services, so …Not good? How so? They don't have a significant overlap in services, so not as if competition is reducing.I am expecting more such mergers to happen across industries as companies try to survive and cut costs.


Virgin Media run the second largest MVNO in the UK. I don't know if the CMA would be too happy about them merging given the fact O2 is second largest MNO and that they own 50% of the largest MVNO (Tesco Mobile).

This merger would give the company an even bigger presence in the mobile market. O2 is known for being poor value, through GiffGaff, Tesco, and O2 themselves. I don't see how this merger is beneficial to the consumer.

These talks do not surprise me given the failed O2 Three merger, Telefonica must be desparate to get rid of O2.
02 Priority

Virgin Red
O2 Are probably the least value out there never been with them ever.
jamie1504/05/2020 19:18

Virgin Media run the second largest MVNO in the UK. I don't know if the …Virgin Media run the second largest MVNO in the UK. I don't know if the CMA would be too happy about them merging given the fact O2 is second largest MNO and that they own 50% of the largest MVNO (Tesco Mobile).This merger would give the company an even bigger presence in the mobile market. O2 is known for being poor value, through GiffGaff, Tesco, and O2 themselves. I don't see how this merger is beneficial to the consumer.These talks do not surprise me given the failed O2 Three merger, Telefonica must be desparate to get rid of O2.


Between the MNOs, there is plenty competition already. Virgin Mobile's market share is also just around 4-5%, so nothing that can create an anti competitive situation.
bozo00704/05/2020 20:12

Between the MNOs, there is plenty competition already. Virgin Mobile's …Between the MNOs, there is plenty competition already. Virgin Mobile's market share is also just around 4-5%, so nothing that can create an anti competitive situation.


I agree there is a lot of competition but there aren't many who like to switch. Consumer loyalty to MNOs is massive. The fact Virgin have managed to get around 4% market share is incredible. If O2 take them over then it means all networks with over 1% market share are controlled by the MNOs directly, which is very uncompetitive.
The deal isnt really a shock as O2 have been desperate to merge/buy somebody out since the deal with Three fell through. They obviously feel too small up againt BT/EE.

It wouldnt shock me if Virgin Mobile was spun off as a separate entity as part of this deal although when you look at the deal agreed by BT/EE it may go through as is.
jamie1504/05/2020 19:18

These talks do not surprise me given the failed O2 Three merger, …These talks do not surprise me given the failed O2 Three merger, Telefonica must be desparate to get rid of O2.


They are - they've being trying to sell it since before the failed 3 merger (which I was surprised to find was 5 years ago.)
alg04/05/2020 20:54

which I was surprised to find was 5 years ago.


markmc99904/05/2020 21:04


May 2016 it was blocked - they merged in Ireland about a year before, then announced in the UK during 2015 iirc.
alg04/05/2020 20:54

They are - they've being trying to sell it since before the failed 3 …They are - they've being trying to sell it since before the failed 3 merger (which I was surprised to find was 5 years ago.)


Crazy to think it was that long ago
Only on o2 for the free Cafe Nero and odd WH Smith freebie. Otherwise I would have gone with a cheaper company
2 of the worst customer service departments going, this won’t end well if it happens.
whatyadoinsucka07/05/2020 06:50

Well it’s s …Well it’s startedhttps://news.sky.com/story/o2-and-virgin-media-merger-to-create-31bn-telecoms-giant-11984367


Vodafone were getting so excited about getting the Virgin Mobile contract from BT/EE but now they may both lose out

Interesting to see the merger will be 50/50. Looks like loads of stores will probably close, if Virgin Media stores/kiosks are in same town as with O2 stores I imagine one will close.

I wonder if they will rebrand to one company. I would imagine they could rebrand Virgin to O2 to avoid paying Branson his cut for using the brand, but they may want to retain the brand to avoid competition getting hold of it.

It is entirely possible this merger could get approved but CMA could require Virgin Mobile to be sold.
The BT/EE merger pretty
much assures it’ll go ahead , possibly without any clauses
whatyadoinsucka07/05/2020 20:25

The BT/EE merger prettymuch assures it’ll go ahead , possibly without any c …The BT/EE merger prettymuch assures it’ll go ahead , possibly without any clauses


Not necessarily, BT Mobile was never that big and BT never had physical stores. Virgin Mobile's size would be a concern. I don't think it's impossible for it to go through but I think it's very likely to be referred to the CMA.

I don't think the merger will be entirely rejected but do think it will not be quickly approved.
Edited by: "jamie15" 7th May
At least where I live EE has better signal than O2. If this were to go through it's likely Virgin Mobile would switch to being an O2 MVNO, so I couldn't use them any more.

Also, for some reason O2 (and often Vodafone) MVNOs seem to offer worse value than EE MVNOs (like Plusnet and Virgin) and 3 MVNOs (like SMARTY and iD Mobile), so it's also possible we would see prices rise on Virgin, which is often the best value EE based network.

Also worth noting that O2 owns giffgaff and 50% of Tesco Mobile, so we could see less competition in the MVNO market.

It's possible the CMA would ask O2 to divest it's stake in Tesco or something like that, as a condition of approving the deal.
npo07/05/2020 20:51

At least where I live EE has better signal than O2. If this were to go …At least where I live EE has better signal than O2. If this were to go through it's likely Virgin Mobile would switch to being an O2 MVNO, so I couldn't use them any more.Also, for some reason O2 (and often Vodafone) MVNOs seem to offer worse value than EE MVNOs (like Plusnet and Virgin) and 3 MVNOs (like SMARTY and iD Mobile), so it's also possible we would see prices rise on Virgin, which is often the best value EE based network.Also worth noting that O2 owns giffgaff and 50% of Tesco Mobile, so we could see less competition in the MVNO market.It's possible the CMA would ask O2 to divest it's stake in Tesco or something like that, as a condition of approving the deal.



O2 also have the contract for Sky Mobile - so not sure that'll will stay. And Virgin were due to move from EE to Vodafone next year? So a few other questions that might arise as well.
Tesco is a JV and also talk talk (on o2) lots of things to iron out I’m sure and of course it’ll be referred due to the size of the deal , sure Eu will pass it over to UK
whatyadoinsucka08/05/2020 03:40

Tesco is a JV and also talk talk (on o2) lots of things to iron out I’m s …Tesco is a JV and also talk talk (on o2) lots of things to iron out I’m sure and of course it’ll be referred due to the size of the deal , sure Eu will pass it over to UK


But they're not really shrinking the market in the way an O2 / 3 merger would have. There won't be a reduction in choice of mobile provider, or TV or broadband. So I can't see any obvious reason for it to be referred to an ombudsman.
alg08/05/2020 13:41

But they're not really shrinking the market in the way an O2 / 3 merger …But they're not really shrinking the market in the way an O2 / 3 merger would have. There won't be a reduction in choice of mobile provider, or TV or broadband. So I can't see any obvious reason for it to be referred to an ombudsman.


Sorry by pass it over to UK I meant to CMA but can’t see a big hurdle should just be a signature approval rather than full blown investigation
alg07/05/2020 21:02

O2 also have the contract for Sky Mobile - so not sure that'll will stay. …O2 also have the contract for Sky Mobile - so not sure that'll will stay. And Virgin were due to move from EE to Vodafone next year? So a few other questions that might arise as well.


Hmm, I didn't realise Virgin were switching to Vodafone, I'll have to check how they perform around my house, might have to switch from Virgin anyway if the signal isn't great.

I guess Virgin will keep the Voda deal in case the merger doesn't go through, but if it goes through, I'm sure they'd scrap it and switch to O2. They would probably pay some sort of fee to Voda by leaving the agreement, but I'm sure they've already factored that in.
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