Virgin Media's Observations on the Anticipated Acquisition by Bt Group Plc ("Bt") of Everything Everywhere ("Ee")
VIRGIN MEDIA'S OBSERVATIONS ON THE ANTICIPATED ACQUISITION BY BT GROUP PLC ("BT") OF EVERYTHING EVERYWHERE ("EE") 1. EXECUTIVE SUMMARY 1.1 This memorandum sets out the observations of Virgin Media ("VM") in respect of the anticipated acquisition by BT Group PLC ("BT") of Everything Everywhere ("EE") (the "Proposed Transaction"). 1.2 The Proposed Transaction is an important development in the rapidly evolving UK communications sector, and comes at a time when further consolidation is expected with the proposed merger of O2 and Three. In particular, communications providers are positioning themselves through commercial agreements, consolidation and organic growth to be able to offer a broader range of fixed, pay TV and mobile services to residential and business customers. 1.3 In that context, the Proposed Transaction will create an operator with a leading position in respect of several key retail communication services (fixed line telephony, broadband and mobile) and advantages in pay TV due to vertical integration. Whilst the merged entity will be able to self-supply, on a national basis, high speed fibre products, 4G mobile services and exclusive pay TV content, it will also be a key, and in some cases the only, provider of those wholesale inputs to downstream retail rivals. 1.4 VM is a wholesale customer of EE and offers mobile services to its subscribers using EE's mobile network through a mobile virtual network operator ("MVNO") arrangement. VM offers a broad range of mobile communications products and services, including mobile voice services and data services (such as SMS and picture messaging), and mobile broadband services which complement the fixed broadband offering.
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