Telefonica Looks for Other O2 Options in United Kingdom

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source: Informa
It is starting to appear that regulators will not allow the proposed merger of Three and O2 in the United Kingdom, a prospect that now has Telefonica looking at other options  for its U.K. business.

Among the other options conceivable in the event of a merger denial are selling to another buyer or spinning O2 off as an independent company.


And some speculate that Liberty Global, owner of the Virgin Media cable TV assets in the United Kingdom, will be interested.

Any successful acquisition by Liberty Global would be a further move by major cable TV operators into the core mobile services business.

In the Netherlands, Liberty Global already is working with Vodafone to sell mobile services to its cable TV customer base. In the United States,

Comcast now says it will bid on 600 MHz mobile spectrum, while Comcast and other cable TV companies already have the right to resell Verizon Wireless services, with the eventual option to create a mobile virtual network operator business that uses wholesale Verizon assets to create a branded retail operation.

The switch in plans by Telefonica shows the big role regulators now are playing in global communication and Internet ecosystem markets.

In recent days, regulators have been active shaping communications markets, creating network neutrality rules that boost or limit business models, changing spectrum licensing rules in ways that permit more intensive use of existing licensed spectrum and freeing up more spectrum for use both licensed and license exempt.

But antitrust regulators also appear to be taking a more prominent role, essentially killing mergers that would have directly affected mobile market structures in the United States and European Union, while preparing to stop a big merger in the U.K. mobile market.

And antitrust investigations directly affecting software suppliers are underway in the European Community.

Actions by private actors matter, but so do ground rules set by regulators that directly affect market structures and potential costs and opportunities within various portions of the broader Internet ecosysetm.

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