Proposed Orange-T-Mobile merger centered around iPhone

[AppleInsider]

Two British wireless carriers hope to merge and create the nation's largest network, partially in a bid to grab Apple's attention and earn the right to sell the iPhone.

According to The Daily Telegraph, the merger of Orange and T-Mobile in the U.K. would have 28.4 million customers representing 37 percent of the market. Tom Alexander, chief executive for Orange in Britain, said the additional clout would be an advantage for the company as it looks to have the iPhone on its network.

However, a potential deal between Orange and T-Mobile is far from a foregone conclusion. Any merger would need to be approved by regulators from the European Union, though company officials said they believe it would be accepted.

"We (Orange) are already the network of choice for multimedia devices, we’ve already got the biggest 3G network, now with T-Mobile we've got an even stronger 3G network," Alexander said. "We’ve got a fantastic platform and are obviously the network of choice for all multimedia devices, including potential the iPhone in future."

Months ago, rumors suggested the iPhone could be leaving exclusive carrier O2 for the British T-Mobile. That report said that the carrier would gain access to the old model iPhone 3G, while O2 would continue to be the exclusive provider of the iPhone 3GS.

Currently, O2 is the British market leader, with 27 percent of the nation's subscribers. Vodafone is in second with 25 percent, followed by Orange (22 percent) and T-Mobile (15 percent).

As the iPhone continues to expand internationally, exclusive contracts like the one first struck with AT&T have become less common. A recent deal between Apple and China Mobile was non-exclusive. Since the two reached a three-year agreement, rumors have surfaced that Apple has turned its sights to competitor China Mobile, which has more than 475 million subscribers.

In the U.S., the exclusive arrangement between AT&T and Apple is scheduled to expire in 2010. While the wireless carrier has reportedly been negotiating an extension, some have speculated that the iPhone will jump to other domestic carriers.

[nli10]

Originally Posted by AppleInsider

Two British wireless carriers hope to merge and create the nation's largest network, partially in a bid to grab Apple's attention and earn the right to sell the iPhone..

It doesn't hurt their chances, but Orange UK call centre staff have been hinting at the iPhone being on Orange by the end of this year either way.

Exclusivity helped Apple get traction, but now it's only hindering their expansion. 2nd tier iPhones on other networks would make sense for both parties.

Chalk the merger up to coincidence and market costs - T & O will get the best 3G coverage and a wide range of offers and tariffs. Orange has integrated home broadband, calls and eventually TV on demand too so the joined company becomes more than just a big telecoms company.

[anantksundaram]

Wow, if this is true, it is truly impressive how one (once-) little computer company has managed to create so many ripples in such a mature business (both handset makers and service providers). I can't think of too many parallels......

[ivan.rnn01]

Sally forth, Orange! It's good time to show to anglo-saxons what iPhone really is and what exactly is the right way to set it up.

[christopher126]

Originally Posted by ivan.rnn01

Sally forth, Orange! It's good time to show to anglo-saxons what iPhone really is and what exactly is the right way to set it up.

Where's England?

[KrisJonesUK]

I think it's a little far-fetched to suggest that the iPhone provided motivation for the proposed merger. T-Mobile's UK operation has had a "For Sale" sign up for some time because it is a loss-making division, despite recent multi-million pound advertising campaigns. The proposed joint venture makes sense in many respects from a business viewpoint. It should enable significant cost savings and further investment in building the UK network. Whether it is in the interest of onsumers is something our Office of Fair Trading will investigate. Obviously being a larger player in the market will make it a more attractive carrier for the iPhone, but to suggest the merger has been prompted by a single handset is a gross exaggeration of its importance.

[VinitaBoy]

"Proposed Orange-T-Mobile merger centered around iPhone"

With all due respect and deference to the headline writer . . . One cannot CENTER AROUND anything. One can CENTER ON something, of course, but "around"? Never.

Otherwise, an interesting article.

[ncee]

The fact that any company would use another companies product(s) to consider merging is pretty amazing. Can't argue the strength of Apple to much, can we.

Skip

[gmcalpin]

Originally Posted by christopher126

Where's England?

It's a suburb of Scotland, I think.

[nli10]

Originally Posted by gmcalpin

It's a suburb of Scotland, I think.

Surely you know England - we are the guys who put all our religious nuts on a boat and sent them out to found South Canada.

As those brave pioneers discovered chips we still love them all dearly though!

[ivan.rnn01]

Originally Posted by christopher126

Where's England?

It must be the south-eastern part of the island of Great Britain. Umm. Last time I saw it, it was somewhere on the way over the Channel.

[sip]

Does T-Mobile even own any masts in the UK, or does it rent from people like Orange, O2 & Vodafone?

Having been with Orange from almost the beginning, I'm peeved at the cost of its Data Plans -- O2's iPhone plan certainly looks better than Orange's add-on for non-business users. If I could get unlimited data and my current level of free minutes for the £35 pmth I pay Orange at the moment, I'd agree a 24 month contract without any hesitation.

I have now decided to go on a rolling contract, as I will never ever need an upgrade phone from Orange (have a 3GS PAYG at a cost of £540, OUCH!), so why have a fixed term contract?

O2 serves me OK for data on the PAYG when I need it, but the signal where I live is non-existent.

[anantksundaram]

Originally Posted by nli10

As those brave pioneers discovered chips we still love them all dearly though!

Hmmm..... are you sure? I thought it was Columbus and crew who found potatoes, in S. America?

[Bishop of Southwark]

Originally Posted by AppleInsider

Any merger would need to be approved by regulators from the European Union, though company officials said they believe it would be accepted.

It would principally be the UK regulators involved - not the EU. This is only Orange (UK) and T-Mobile (UK) we are talking about here, not the whole of Orange and T-Mobile.

So it will be the Competition Commission (successor to the monopolies and mergers commission), and ofcom that will be the key decider.

[ivan.rnn01]

Originally Posted by KrisJonesUK

I think it's a little far-fetched to suggest that the iPhone provided motivation for the proposed merger. T-Mobile's UK operation has had a "For Sale" sign up for some time because it is a loss-making division, despite recent multi-million pound advertising campaigns. The proposed joint venture makes sense in many respects from a business viewpoint. It should enable significant cost savings and further investment in building the UK network. Whether it is in the interest of onsumers is something our Office of Fair Trading will investigate. Obviously being a larger player in the market will make it a more attractive carrier for the iPhone, but to suggest the merger has been prompted by a single handset is a gross exaggeration of its importance.

1. Now Orange have money (thanks to iPhone sales).
2. They smell that the universal end of exclusive deals on iPhone is in the doorway.

[Bishop of Southwark]

Originally Posted by sip

Does T-Mobile even own any masts in the UK, or does it rent from people like Orange, O2 & Vodafone?

Yes, it is one of the 4 real operators, with its own masts.

However, keep in mind the brand is separate to the masts. The customers are also separate to the brand and masts. The chances of a new (merged) brand being formed are probably as near to nothing as you are going to get.

Either the company will continue to operate two brands (and just be merged at a corporate level), or the corporate will continue with the Orange brand which is far stronger in the UK than T-Mobile.

But the T-Mobile brand could still remain as a virtual operator brand. Thought the 'ownership' of existing customers is certain to be unified in the new company, regardless of what brand they (the consumers) believe continue to be with (and if that brand still around or in what format) - as that is where the value is beyond infrastructure efficiencies.

[simonsharks]

Proposed Orange-T-Mobile merger centered around iPhone

Wow. Something must have got lost in translation when this story made its way over the pond.

[ivan.rnn01]

[JeffDM]

Proposed Orange-T-Mobile merger centered around iPhone

Originally Posted by simonsharks

Wow. Something must have got lost in translation when this story made its way over the pond.

The AI article doesn't bother to link to the Telegraph article(s) that it is discussing. There are three Telegraph articles about this potential merger, and only one of them (the third one below) even mentions the iPhone. That the one that does mention the iPhone doesn't assume the merger is done mostly because of the iPhone, like the AI article seems to. My understanding is that it is likely a side effect, not the causative driver.

http://www.telegraph.co.uk/finance/n...-operator.html

http://www.telegraph.co.uk/finance/c...t-crossed.html

http://www.telegraph.co.uk/finance/n...fter-deal.html

[SpamSandwich]

Originally Posted by JeffDM

The AI article doesn't bother to link to the Telegraph article(s) that it is discussing. There are three Telegraph articles about this potential merger, and only one of them even mentions the iPhone. That the one that does mention the iPhone doesn't assume the merger is done mostly because of the iPhone, like the AI article seems to, I read it as likely a side effect, not the causative driver.

http://www.telegraph.co.uk/finance/n...-operator.html

http://www.telegraph.co.uk/finance/c...t-crossed.html

http://www.telegraph.co.uk/finance/n...fter-deal.html

Deliberately twisting the intent of the original article is just bad form. Bad, Katie! Bad!

[UltimateKylie]

Typical deluded Apple fanbois that think everything revolves around Apple.

This deal had very little if anything to do with an iPhone and T-Mobile and Orange were gonna get the iPhone regardless.

T-Mobile UK has been on sale for months with Orange, O2, and Vodafone interested. So O2 could have bought T-Mobile or any number of possibilites. Deutshe Telekom didn't like the performance of T-Mobile UK and wanted it gone.

[RichL]

Proposed Orange-T-Mobile merger centered around iPhone

[citation needed]

If you've been following this story for a while, you'll know that the main drivers are T-Mobile's increasing focus on the US market and the push to reduce costs. The iPhone may be a secondary reason but it's nowhere near as important to the two companies.

[Abster2core]

Originally Posted by AppleInsider

According to The Daily Telegraph, the merger of Orange and T-Mobile in the U.K. would have 28.4 million customers representing 37 percent of the market.

My first thought after reading the above was that there must have been a population explosion in the past few years.

I understand that the UK has just over 60 million residents.* If so, the two companies would have over 47% of the entire population as customers. I would be interested in hearing how they define the "market."

*https://www.cia.gov/library/publicat...k/geos/uk.html

[RichyS]

Originally Posted by Abster2core

My first thought after reading the above was that there must have been a population explosion in the past few years.

I understand that the UK has just over 60 million residents.* If so, the two companies would have over 47% of the entire population as customers. I would be interested in hearing how they define the "market."

*https://www.cia.gov/library/publicat...k/geos/uk.html

Ever thought that some people might have more than one mobile? I certainly have a personal T-Mobile contract, and a work O2 contract.

Having said that, the operators are a little fast and loose with their numbers -- PAYG in particular. Most operators will still count you as a 'customer' even if you haven't used the SIM for 3-6 months. With churn rates as high as 30%, that's a lot of double-counting! So, a more realistic number might be a good 20-25% lower than the operator claimed number.

[irnchriz]

Having been with both Orange and T-Mobile in the UK I am glad that I am with neither now. Orange customer service used to be fantastic, now, its crap. T-Mobile have countless issues with their network infrastructure which leads to missed calls, no caller ID and service dropouts.

[RichL]

Originally Posted by Abster2core

I understand that the UK has just over 60 million residents.* If so, the two companies would have over 47% of the entire population as customers. I would be interested in hearing how they define the "market."

Cell phone penetration in the UK stands at about 110% (i.e. 66 million customers in a population of 60 million people). Many people either have a work and personal SIM or two personal SIMs. So, one person can be double-counted in some instances.

I believe Italy has even higher cell phone penetration, around 117% the last time I looked.

[Abster2core]

As I raised originally,

Originally Posted by AppleInsider

According to The Daily Telegraph, the merger of Orange and T-Mobile in the U.K. would have 28.4 million customers representing 37 percent of the market.

My first thought after reading the above was that there must have been a population explosion in the past few years.

I understand that the UK has just over 60 million residents.* If so, the two companies would have over 47% of the entire population as customers. I would be interested in hearing how they define the "market."

*https://www.cia.gov/library/publicat...k/geos/uk.html

Originally Posted by RichL

Cell phone penetration in the UK stands at about 110% (i.e. 66 million customers in a population of 60 million people). Many people either have a work and personal SIM or two personal SIMs. So, one person can be double-counted in some instances.

I believe Italy has even higher cell phone penetration, around 117% the last time I looked.

According to the CIA Factbook, the UK has over 72 million cell phone subscribers.

As a researcher, I was just interested in how they defined the market, in particular, the number of customers, i.e., people, were unique subscribers.

Consider (1) that approximately 25% of the population, i.e., young children and the elderly, would be less likely to have such and an indigent rate of at least 6%, and other factors that may influence purchasing power, e.g., labour force 50%; below poverty line 14%; unemployment 6%, etc.

(2) Much of European cell phone users use prepaid cards.

The last fact alone makes it virtually impossible to determine the actual number of unique users.

[JeffDM]

Originally Posted by RichL

Cell phone penetration in the UK stands at about 110% (i.e. 66 million customers in a population of 60 million people). Many people either have a work and personal SIM or two personal SIMs. So, one person can be double-counted in some instances.

I believe Italy has even higher cell phone penetration, around 117% the last time I looked.

Some people mentioned that carriers count SIMs that haven't been active for several months to half a year.

How do people handle multiple SIMs if they keep them in active use? Are they carried around like loose change, you swap them at home, at work or what? Do you carry around multiple phones? Seems pretty cumbersome to me.

[SGSStateStudent]

Originally Posted by SpamSandwich

Deliberately twisting the intent of the original article is just bad form. Bad, Katie! Bad!

Who's Katie?

[samab]

Originally Posted by JeffDM

Some people mentioned that carriers count SIMs that haven't been active for several months to half a year.

How do people handle multiple SIMs if they keep them in active use? Are they carried around like loose change, you swap them at home, at work or what? Do you carry around multiple phones? Seems pretty cumbersome to me.

"Active" doesn't mean that it's active use --- it means you are paying the prepaid top-up fee once every few months in order to keep your telephone number.

In third world countries like India, they make specialized GSM phones that can hold 2 SIM cards.

Virgin Mobile USA's IPO papers said that they used 150 days --- when the rest of American carriers use 90 days. Idiots should know that those were big alarm bells and shouldn't have invested in the IPO in the first place. They lost their ass with that IPO.

http://seekingalpha.com/article/3485...usa-ipo-filing

Softbank Mobile keeps on winning more subscribers every month --- their secret? Not the iphone, but an accounting change --- they use an even more absurd 12 months rule (when the rest of Japanese carriers also use 90 days rule).

http://analytica1st.com/analytica1st...look-good.html

[fourthletter]

This whole article is total FUD ! the original Telegraph article hardly mentions the iPhone, O2s exclusivity rights to the iPhone ends this year and Orange and others say they will also be selling it before xmas.
T-Mobile UK has been for sale for a while and this merger was dreamed up to get around strict regulator control that would apply to a sale but not a merger.
Sorry kids but you totally made this story up just link something to Apple since It's only rock and roll
was such a massive let down !
FUDFUDFUDFUD

[JeffDM]

Originally Posted by fourthletter

This whole article is total FUD ! the original Telegraph article hardly mentions the iPhone, O2s exclusivity rights to the iPhone ends this year and Orange and others say they will also be selling it before xmas.
T-Mobile UK has been for sale for a while and this merger was dreamed up to get around strict regulator control that would apply to a sale but not a merger.

Makes sense, someone pointed out that this article was twisted from the source.

Sorry kids but you totally made this story up just link something to Apple since It's only rock and roll
was such a massive let down !
FUDFUDFUDFUD

Do you know how to read dates? This story was published on Tuesday, the Apple presentation was Wednesday.

[Di623]

The difference really is just apples and oranges isn't it???