The European Commission’s antitrust chief on Monday disagreed with telcos’ claims that without consolidation it is harder to increase investment.
"I’ve heard this claim quite often, but I have not seen evidence that this is the case," said EU competition commissioner Margrethe Vestager, in a speech delivered to the Concurrences conference in Paris.
"In fact, infrastructure investment can be stimulated by competition," she said, claiming that telecoms investment in France increased overall following Free Mobile’s entry in 2009.
Vestager did not say whether the growth was driven by operators responding to Free’s launch or by the simple fact that there was suddenly one more player spending money on network equipment.
Since then, a wave of consolidation has swept over Europe’s mobile market, with M&As taking place in Austria, Germany, Ireland and the U.K.
In May, the GSMA called on Brussels to rethink its approach to mobile consolidation, after research it commissioned concluded that investment in new network technology, rat her than the number of market players, is the bigger driver of retail price reduction.
The study, carried out by Frontier Economics, also insisted there is no robust evidence that four-player markets enjoy lower prices than three-player markets.
It seems though that the mobile industry and the European Commission are not going to see eye to eye any time soon.
"There is ample evidence that excessive consolidation may lead not only to less competition and more expensive bills for consumers, but that it also reduces the incentives in national markets to innovate," Vestager said.
