Orange and T-Mobile to Merge

As predicted on this very blog Orange and T-Mobile are to join forces to become the largest mobile telecoms company in the UK. The deal has been announced but has yet to be checked by the relevant regulatory bodies. The new company will start with 28.4 million customers and around 37 percent of the market. No details about branding have yet to be released but T-Mobile has been under performing lately and insiders have suggested that this deal has saved them from certain doom so I wouldn't be surprised in their brand name is let go.

This means that the Big Five mobile phone companies in the UK are now to become the Big Four with O2, 3 and Vodafone making up the numbers. Some have speculated that this could have a negative effect on consumers. Whilst the new Orange/T-Mobile hybrid will no doubt be able to offer increased coverage for mobile and mobile broadband it reduces the amount of competition in the UK market which could have an influence on prices.

Whilst the merger will cost the newly formed company it will also allow them to drastically reduce costs. Duplicate base stations and retail outlets will be closed and staff costs reduced. Most large towns have both an Orange and a T-Mobile shop and there will be no need for these to both remain open. Those who are already signed up with one of the companies are likely to see signal and coverage improvements.

Orange Launches Mobile Broadband Contract for Under £5 Per Month

The mobile broadband industry suffered some negative press recently when Ofcom released it's data about average download speeds and coverage. The average speed achieved is actually considerably less that the 'up to' speeds normally advertised. This will come as no big surprise to most but Ofcom argued that the main providers should be more clear about the speeds customers are actually likely to experience.

Orange has attempted to get customers back on side by offering a new low cost pay monthly mobile broadband package. The contract is the first to be offered for under £5 per month and comes with a free dongle. Users are tied in for 18 months giving a total cost of around £90.

Other new contracts recently released offer pay as you go and even month-by-month mobile broadband contracts. There is now a much wider range of contracts on offer to the 9/10 homes which have yet to sign up for mobile broadband.

The downside to Orange's new contract is that is only offers a meager 500mb monthly download limit. This might be enough to check your emails and browse occasionally but it wouldn't last long for most users. The deal is only being offered to those who already have a fixed line broadband or mobile phone contract with Orange.

Orange and Vodafone Bid for T-mobile

Mobile phone company T-Mobile is owned by Deutsche Telekom but might not be for much longer. Both Orange and Vodafone have expressed an interest in taking over the company. T Mobile has been under performing recently despite the appointment of a new MD but is not yet in the position of having to sell up in a hurry.

T-Mobile is the 3rd largest mobile phone company in the UK with around 19.2 million subscribers. Vodafone is the largest provider and Orange the 4th largest. Whoever is successful in their bid is likely to become the largest mobile phone operator in the UK by inheriting T-Mobile's massive user base.

If either Orange or Vodafone are successful in their takeover bids then the big five Mobile Phone providers in the UK will become the big four. Some have speculated that this will be bad news for consumers as it will result in less competition. Personally I believe that having one provider with double the amount of subscribers will mean that other companies will be forced to bring out some eye catching deals in order to compete. This would potentially be good for the consumer who is used to getting more for their money each year as it is.

Three mobile have already taken the big step of introducing free Skype-to-Skype calls as well as free Three-to-Three calls for most packages. It will be interesting to see how the other four (soon to be three?) providers compete with this.