The Competition and Markets Authority confirmed it will launch a so-called Phase 2 probe after both firms told the regulator they would not be offering measures to ease its concerns ahead of the deadline. The CMA said last month that the tie-up could have a “substantial” impact on competition, warning it may lead to higher prices and reduced quality. Our business newsletter will give you the inside track. It gave the companies until April 2 to address its worries.
The regulator said it found in its initial probe that the two companies are important alternatives for mobile customers and combining these two businesses will reduce rivalry between mobile operators to win new customers. The watchdog also raised concerns that the deal “may make it difficult” for smaller mobile operators – such as Sky Mobile, Lebara and Lyca Mobile – to negotiate good deals for their own customers, by reducing the number of mobile network operators which will host them.
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