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News 

The subscribers argue that T-Mobile’s acquisition of Sprint drove up the prices of their wireless package 

This week, a federal judge has ordered T-Mobile US must face a lawsuit from Verizon and AT&T customers over price increases. 

More specifically, the customers (all seven of them) are claiming that T-Mobile’s $23 billion merger with Sprint back in April 2020 damaged competition in the market to such an extent that AT&T and Verizon were able drive up prices for their wireless services. 

Prior to the merger’s completion, there was significant worries that the merger would be anticompetitive. Democratic senators urged the Federal Communications Commission and the Justice Department to reject the merger proposal in 2019, emphasising that the merger was “likely to raise prices for consumers, harm workers, stifle competition, exacerbate the digital divide, and undermine innovation”.  

The lawsuit alleges that at least some of these fears have indeed become reality, with the court agreeing that the higher prices charged by AT&T and Verizon could “plausibly” be directly linked to the T-Mobile–Sprint merger.  

“The merger also eliminated the two “maverick” firms that were responsible for much of the price competition and innovation among the carriers. Before the merger, T-Mobile and Sprint aggressively competed with the bigger brands (AT&T and Verizon) through offering discounts and new plans,” read court documents seen by Reuters. 

“Sprint was financially viable and would have continued to compete vigorously absent the merge… Additionally, Plaintiffs allege that by making the newly merged T-Mobile’s scale and cost structure more like the other two big players, the merger curtailed its incentive to compete.” 

The subscribers in question are seeking monetary compensation and a range of additional penalties, even including the reversal of the merger entirely.  

“If plaintiffs are unhappy with Verizon and AT&T, there is a remedy available in the highly competitive market that wireless consumers enjoy today — they should switch to T-Mobile, not sue it,” lawyers for T-Mobile told the court. 

T-Mobile have yet to comment on the situation directly. 

Join the US operators in conversation at next year’s Connected America in Dallas, Texas 

Also in the news:
Unfair! UK customers decry mid-contract price rises in new survey
EU competition regulators give Vodafone–Three merger the thumbs up
Viasat to cut 10% of workforce 

Next-generation digital services and consulting group Infosys has announced what it calls a new proximity centre in Sofia, the capital of Bulgaria, as part of its continued growth in Europe.

The new state-of-the-art centre will, says Infosys, enable it to attract, re-skill, and up-skill 500 new employees. Over the course of the next four years, these new employees will work on global opportunities around next-generation digital technologies including Infosys Cobalt Cloud Solutions, Infosys Topaz AI and automation, data and insights, IoT, 5G and software engineering.

Why Bulgaria? According to Infosys, the country has built a reputation as an attractive market for IT development thanks to its advanced IT infrastructure, strong pool of local IT specialists and excellent IT knowledge.

Located in the nation’s capital, this centre will provide what is described as an ideal environment for companies spanning various sectors such as financial services and retail, both within Bulgaria and throughout Europe, to convene and drive digital transformation efforts.

Partnering with these organisations, the centre will serve as a hub for ideating, incubating, creating, and scaling innovative emerging technology-based solutions.

Serving global and European customers, the centre will support customers as they accelerate their AI and cloud-led digital journeys and will further strengthen Infosys’ existing client relationships in Europe, particularly in manufacturing, retail and financial services sectors.

Infosys says it will also use this centre to rapidly scale up teams across digital and analytical capabilities as well as SAP and cloud.

If the merger is approved, the new company would become the largest mobile operator in the UK 

News 

According to a Reuters report that cites a European Commission filing, the proposed merger of Vodafone and Three does not pose any competition concerns to EU antitrust regulators. 

The European Commission is overseeing the review process of the merger, with an official deadline of December 6th for its final decision. Although the process is still ongoing, this filing suggests the final decision will favour the merger. 

The two firms officially submitted their request for approval from the European Commission on 30th October.  

According to the report, the EU regulatory body is reviewing the potential merger with a “simplified procedure”, which is used when mergers are unlikely to raise competition concerns. 

While this approval is no doubt a positive sign for the two UK telcos, the deal is expected to face far greater scrutiny by the UK’s own competition regulators. The UK’s Competition and Markets Authority (CMA) announced last month that it was seeking views and comments from interested third parties on the deal, ahead of its formal investigation.  

“Millions of consumers and businesses in the UK rely on Vodafone’s and Three’s mobile networks to stay connected,” said Sarah Cardell, chief executive of the CMA, in a statement.  

“We will be carefully considering how this deal may affect competition in the UK, which could affect the options and prices available to customers. We will also assess how it may affect incentives to invest in the quality of UK mobile networks. This is an opportunity for those with an interest in this merger to let us know their views before we launch a full investigation.” 

Those who expressed their concern over the merger included consumer group Which? who concluded that “there is a substantial risk that the merger could have negative outcomes for consumers in the short term, including less choice, lower quality and higher prices”. 

Vodafone and Three expect the deal to be completed by the end of next year, should it proceed without any significant issues. 

Keep up to date with the latest news of the merger by subscribing to the Total Telecom newsletter 

Also in the news:
Viasat to cut 10% of workforce
Port of Tyne switches on 4G/5G private network
Spanish govt considers stake in Telefónica to counter STC’s influence  

News 

Uswitch and Which? have both called on UK regulator Ofcom to end mid-contract price rises, with reports showing 85% of customers consider them ‘unfair’ 

In a survey of 2,000 broadband ISP and mobile customers commissioned by Uswitch, 85% of customers were found to view annual price rises as “unfair”, while 87% believe they should be allowed to leave their provider without penalty if prices are raised mid-contract. 

Broadband and mobile providers typically raise their prices each year nu up to 4%, plus an inflation-based metric such as CPI (Consumer Price Index) or RPI (Retail Price Index). These increases are often buried in the terms and conditions of the contracts, leaving customers broadly unaware of just how much their prices may increase. To make matters worse, operators typically apply penalty fees to customers attempting to end their contracts early, hence making it difficult for them to switch providers if their monthly bills increase unexpectedly.  

The survey found that a large part of the challenge here was consumers not realising how much their prices could increase, with 40% saying their biggest concern was being unable to anticipate the scale of a price increase. 

In addition, 62% of participants said they would seek to change providers at the next possible opportunity if prices were raised unexpectedly. 

In February, Ofcom launched a review to examine whether inflation-linked, mid-contract price rises give phone and broadband customers sufficient certainty and clarity about what they can expect to pay. Initial research showed that over one third of mobile and broadband customers were unsure if their provider could increase its prices.  

“Customers need certainty and clarity about what they will pay over the course of their contract. But inflation-linked price rises can be unclear and unpredictable. So we’re concerned that providers are making it difficult for customers to know what to expect,” said Ofcom Director of Telecoms Consumer Protection, Cristina Luna-Esteban in a statement. 

“We’re calling for an end to the practice of inflation-linked annual price rises in broadband and mobile contracts,” said Uswitch spokesperson and Head of Broadband and Mobiles Ernest Doku.  

Which? Also voiced a similar complaint, noting that on average, EE, Three and Vodafone customers could see increases of more than 8% in 2024, while O2 customers could see their bills increase by over 10%. 

“We’re taking a thorough look at these types of contract terms, to understand fully the extent to which customers truly know what they’re signing up to, and whether tougher protections are needed,” said Ofcom.

This year, the UK Committees of Advertising Practice have also provided new guidance about how operators and ISPs should communicate price rises to customers, which will be enforced at the end of the year. 

“In short, it is crucial that information about any future price increases are clear to consumers in the ad itself, to avoid creating a misleading impression that the initial stated price will remain the same throughout the contract period,” said the Advertising Standards Authority. 

Ofcom is expected to publish its consultation paper on the review in December. 

Keep up with latest regulatory guidance by subscribing to the Total Telecom newsletter 

Also in the news:
Viasat to cut 10% of workforce
Port of Tyne switches on 4G/5G private network
Spanish govt considers stake in Telefónica to counter STC’s influence  

News 

Viasat currently has around 6,800 employees, with offices in North America, Europe, and Asia 

Satellite firm Viasat has announced its intention to reduce its workforce by 10%, cutting 800 roles. 

The firm was acquired by Inmarsat earlier this year for $6.2 billion. As a result, the firm is undergoing a large-scale reorganisation to streamline its operations.  

The firm expects $100 million annual cost saving as a result of the cuts, starting in the fiscal year 2025., However, the business expects it will cost around $45 million to rationalise roles between the two merged businesses. 

Guru Gowrappan, president of Viasat, confirmed that the job cuts are “consistent with our goals to focus our spending toward our biggest growth opportunities and position Viasat for long-term success, while expanding margins and profitability”.  

Inmarsat expects that once Viasat’s assets are fully integrated, they will increase the pace and scope of innovations within in the satellite connectivity sector, which will allow for improved capabilities being presented to customers, addressing the constant issues of the ever-increasing speed, flexibility, reliability, coverage, and security. 

“Since we completed the acquisition of Inmarsat, our focus has been on accelerating our leading role in global mobile satellite communications by converging our technologies and organizational structures to deliver enhanced products and services to our customers. We will continue working to better unify our go-to-market approach, and maximize operational and capital productivity,” said  Gowrappan in a statement. 

“Our goal is to be the undisputed leader in satellite communications with a sharp focus on providing the best products and services for our customers,” he continued. 

“We are more than the sum of our parts. This combination broadens the global fixed and mobile services available to customers in an industry-defining moment. We intend to move quickly to bring the best from each company together in a way that creates much deeper value for our stakeholders and ensures we deliver on our synergy commitments.” 

Further details of this news are expected to be shared at Viasat’s Q2 earnings on November 8. 

It makes sense that Viasat are undertaking cost-cutting measures, in part because of the current technical problems on their recently launched satellites. The ViaSat-3 and Inmarsat (1-6) F2 have both faced major issues, undoubtedly causing the firm financial strain. 

Want to keep up to date with all of the latest UK telecoms news? Sign up for Total Telecom’s daily newsletter   

Also in the news:
Colt acquires Lumen EMEA for $1.8 billion
Port of Tyne switches on 4G/5G private network
Spanish govt considers stake in Telefónica to counter STC’s influence 

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Keep up-to-date with all the latest news, articles, event and product updates posted on Developing Telecoms.
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Mobile and broadband subscriptions in Vietnam are predicted to see steady growth from 2023 to 2030 delivering revenue increases for operators, on the back of wider economic growth in the country. 

This is according to analyst company Research and Markets, which stated mobile subscriptions will rise 1.1% and fixed broadband by 3.4% over the next seven years.

Revenues from mobile will thus increase as operators transition from 2G and 3G to 4G mobile data services. The Vietnamese mobile market saw a slowdown in 2018 and 219 due to pressure on legacy 2G voice and SMS revenue.

Capex from service providers is expected to remain “stable” until 2030 as spending on 5G has yet to be deployed as providers are focused on rollingl out fibre broadband. Major providers such as Viettel, Vinaphone and Mobifone are “aligning their investments with revenue growth, maintaining a consistent Capex to Sales Ratio.”

The mobile market saw a shift in 2020 when 3G and 4G subscribers surpassed 2G subscriptions for the first time. Operators then began shifting from prepaid voice and SMS services to data centric ones. 

Research and Markets predicted 5G will make up over half (66%) of subscriptions by 2030 equating to around 90 million subscribers. Meanwhile, 4G will account for 34% in this period and the shutdown of 2G is scheduled for 2025, followed by the switching off of 3G by 2026. 

Viettel, Vinaphone and Mobifone have around 90% of market share, and mergers between smaller players such as Gmobile, Hanoi Telecom, Saigon Post Tel, and SCTV could be announced in future. Government reduction in stakes in VNPT and Mobifone by up to 50% could also occur to bring in private investments and enhance market transparency.