Watchdog says yes to BT's EE takeover deal. Shrugs. No 'significant' harm in it The UK's competition watchdog has today cleared the £12.5bn takeover of EE by BT, finding that the merger will "not cause significant harm to competition or the interests of consumers." The deal will give BT a 32 per cent share of the the mobile subscription market and nearly 600 EE shops. Earlier this week The Register …
I am an EE Fibre broadband customer. Their service is provided through BT Wholsale, as is every other ISP in my area with the possible exception of TalkTalk, who went door to door a few years ago saying that they could offer unbundled broadband free of BT Wholesale, if you can believe their poorly trained sales people
As it is, I'm going to get pretty much the same levels of availability regardless of which ISP I use. Fortunately, I've never had to use EE's broadband support. Lucky, I suppose.
Interestingly, when fibre became available in my area, I got my installation working before any of the regular BT customers, because BT insisted on an engineer visit, whereas EE just shipped the router and told me to plug it in when the ADSL stopped working. As a result, I think I was one of the first FTTC customers in my area. Was absolute bliss for the first month, with 79.99 Mb/s sync rate, until other users started coming on-stream.
Another benefit was because I was a triple play (phone, fibre broadband and mobile) customer, not only did I get discounted line rental, but I also received, out of the blue, an EETV box, so they could count me as a quad-play customer, not that I pay EE anything for any TV services. Hope they don't want it back after the merger. It's a good four tuner freeview PVR.
I am an EE Fibre broadband customer. - Peter Gathercole
As you say EE is simply a BT Wholesale customer and hence your DSL connection is terminated at your exchange on the BT Wholesale LLU and the (Internet) connection out of your local exchange is also mostly through BT infrastructure rather than a third-party's. So there will be little physical infrastructure change arising from this merger.
My only concern is that currently I'm using (EE) bandwidth that is subject to contractual SLA's between BT and EE, that is moitored and arbitrated by Ofcom; in the new BT/EE organisation this SLA becomes an internal arrangement...
Define British.
Shares are publicly-listed in London and New York, available to anyone wishing to buy irrespective of nationality.
Staff (including senior managers) are drawn from and work in many countries around the world - and don't necessarily work in their home countries. I recall some very senior non-Brits at the helm, including (ahem) Verwaayen.
Granted, HQ is in London... But the point is, even if BT were bought out by a firm with its HQ in another country, it wouldn't be any less (or more) British...
It would probably pay rather less tax in the UK than it does today though if that happened.
Er, no.
Even if BT were owned by a consortium of oligarchs from Iceland, Kenya and Brazil the profits from selling products and services in the UK would attract the unwavering attention of HMRC. You don't get out of paying taxes by being foreign.
Incidentally, if anyone reading this is an oligarch from Iceland, Kenya or Brazil then I have a very interesting business proposition...
"Even if BT were owned by a consortium of oligarchs from Iceland, Kenya and Brazil the profits from selling products and services in the UK would attract the unwavering attention of HMRC. You don't get out of paying taxes by being foreign"
Yeah you do. You set up a company in Luxembourg that sells some kind of service to BT. Maybe IT services to support the network. The amount of the charge from Luxembourg is just about the same number as the profit that would otherwise exist in the UK. No profit - no corporation tax.
The Luxembourg business is wildly profitable of course, what with having 3 staff and an office above a shop - but the taxation regime is so 'friendly' in Luxembourg that it doesn't matter. The sales of Maseratis in Iceland, Brazil and Kenya increases dramatically.
How do you think Amazon and Google and Starbucks and all the others manage to run successful growing business while paying not much at all in the way of tax?
"profits from selling products and services in the UK would attract the unwavering attention of HMRC. You don't get out of paying taxes by being foreign."
You owe me a keyboard, and probably medical treatment from splitting my sides; if everything goes as usual, they wont pay a PENNY in tax, and if they pay enough bribes, sorry, I mean smooze, enough HMRC managers, they will probably get a big tax rebate for fictional losses cause by the sale.
I switched from EE to BT mobile, late last year, for a deeply discounted SIM only plan (20GB plus unlimited minutes and texts). No complaints, so far (I sometimes watch Netflix, while commuting), but there are downsides. For example, BT don't like tethering (though my Nexus 5 agrees, while my iPhone plays the Gimp, and bends over for BT), and data roaming is hideously expensive, if outside of Europe or the US. I'm hoping the product will be folded back into EE's portfolio...
Umm...what?
"Virgin customers can probably look forward to more calls urging them to switch to slower broadband, a Freeview box with BT sports, all at a higher cost."
I'm a 3-play customer (TV, landline, broadband) who moved from Sky to Virgin's equivalent service. Virgin's broadband is consistently at least twice the speed I got with Sky and also much faster than a couple of neighbours on BT broadband), not to mention more reliable.
Virgin are also significantly cheaper than Sky (never checked the price of BT)
The down side is that Virgin's PVR is rubbish due to a poorly designed and laggy UI.
Let's hope we get 'REAL competition' - like the Energy Market? with BT and those millions of POTs lines that have paid for themselves many times over. There are only 2 players in Comms Virgin and BT
is'nt Plus Net BT in another guise? - Every Company in phones. moby and energy market should have no more than TWO Tariffs High and Low so we can see what's competitiive. That however, would be too easy and helpful. All this bull**** about 'how much do you use' is a smokescreen.
I remember when running up to the year 2000 (maybe around 1996) - some sort of survey to professors and other techno types to predict what we will see in the future.
Most of them said totally free phone calls as the infrastructure is almost complete and paid for.
Ha. So we all pay a "rental" on a cable fibre that will last for years, requires no maintenance (unless the gas/electric board dig it up), and is already paid for 1000's of times over.
Sometimes I wish I was back in the 70's, when the world didn't need all this crap.
"not cause significant harm to competition or the interests of consumers."
How is it we all know where this is going except @Ofcom wonks / officialdom?
Crucially BTHomehub 6 is to become an EE femtocell ADSL/VDSL/802.11ac/3G/4G for both you and you're nearby neighbours.
Your iPhone / Samsung Galaxy (artificially overpriced so you need to have a monthly lease from Sweetie - BT/EE) will pick up its signal from there (inside your house) rather than the nearest mast.
You're Quad Play subscription will then bill you per MB for data at EE rates (NB. including roaming rates for your American visiting friends i.e. upto £7.50 a MB).
Remember this is for data that passes through your BTHomehub (which you pay the electricity/standing charge bill for and pay for the hub device through subscription/its delivery up front) and your hub/house also carries the signal of others for Sweetie, for which you receive absolutely no commission/discount for.
...which you pay the monthly BTInfinity subscription for, (not forgetting the additional of £18.99 line rental for 'maintenance', as you don't make calls on it anymore),
...which your taxes have funded the roll-out of said Fibre Cabinet in the street for,
...which has been delayed again and again since 2010, (at least 7 times 'new dates' on my exchange/certain cabinets) that any subsidies paid to Sweetie, meant to actually speed up roll-out were completely pointless, as Sweetie totally ignored all MPs requests anyway with roll-out proceeding at a pace which suited Sweetie and no-one else.
They also made sure that any rollout of 'actual' FTTP was made out to be physically impossble, so keeping figure around the 0.1% mark, instead upgrading 0.5mm copper to 0.9mm copper to address issues where possible, on a so called 'fibre' rollout?
...Sweetie hoards its infrastructure / dark fibre, charges an arm and leg for others to access its poles, ducts, because well, its a monopoly - it can, to the point giving regulatory access in the first place was pointless.
...and of course, the exchange building is the tattiest building in the town, and hasn't been painted for 20 years, to make it look like Sweetie is poverty stricken.
All in all we've ended up wih a 'Cul-de-Sac' technology in the form of FTTC/g.fast, which is perfectly implemented to be ready to request the next set of Government handouts to get past the 300MBps max out bottleneck, at a theoretical max distance of 300m from each house (150m by the crow flies).
No one questions the amount of delicate electronics (FTTC cabinets) that has been destroyed/exposed to the elements/floods in North Yorkshire/Lake District/Wales/SW (which wouldn't have been such an issue if actual fibres to homes had been deployed).
Its about time we had some people with some actual fucking technical competence at least making this piss poor Regulatory decisions, because we coudn't be in a worse position if you'd pulled straws out of a hat.
With that quantity of strawmen in one place you could probably open your own scarecrow museum.
What you miss, what many people miss, is that there is no monopoly. You can start a telco today if you want. Why don't you? If the existing options are so poor and so overpriced then you're bound to make a killing, right? You claim exceptional technical competence so it would be easy for you.
I worked on a project in the Netherlands to do just this - set up a telco to avoid paying the incumbent, KPN, money for their service. It never got off the ground and not for any lack of technical competence.
Start small, pick a town and get building. You can rent duct and poles from BT, but C&W and KCOM and some others will also do that if you'd prefer. You can install your kit in a BT exchange, but you can choose a datacentre or similar as well.
Your problem won't be technical, it'll be financial. You're a big fan of FTTP. Great, it's very cool. It will cost you £2000 a house to deliver though. Blocks of flats and things are cheaper but the suburbs with bigger homes with driveways, they cost a fair bit more. Rural areas - multiple it by ten. How much are you going to charge your customers to recoup that £2K? You mentioned that line rental at £19 is too much, so let's aim for £15. The only trouble is - that's going to take 11 years to repay the installation cost, without charging anything for the service or making a profit. You'll need to pay interest on the £2k loan you took out as well, so maybe it's more like 20 years rather than 11. Damn that compound interest.
So - you have your business plan. A town of 40,000 people say. Maybe one in five will buy your service - 8,000 people (less in reality, I'm mixing households and people). Now you need to go the bank or some investors and ask for £16M before your wagons roll. But - you've got to tell them that they won't see it back for years and years, let alone make any kind of return on it. It's risky as well, because if 5G or something comes along and renders your network obsolete your income drops to zero before you've paid anyone back.
That last paragraph, that's the problem. Forget all your technical stuff. The problem for BT and for Virgin and for Gigaclear and BB4x is that the market's price for better broadband doesn't much support the investment needed to deliver it. That's why things like G.Fast are going to be popular - not just in the UK but globally - because they allow telcos to offer better products at prices people can pay without going bust. That's why BT needs government money for rural areas and Virgin's rollout has stalled for a decade. It's why most new entrants fail. That's why I regularly pay thousands of euros for a single installations of fibre to my customers' sites elsewhere in Europe and a thousand pounds or more a month in rental. The telco derisks the build by making me pay for it upfront. That's why in the New Zealand example that people talk about the government had to give the spun off last mile business a thousand quid per household in the country to make the network viable.
If the UK was uniquely bad in Europe or the world, you might have a point about BT's competence or priorities. They're not though. Britain's about average - I think broadband is more widely available than the average, the price is a bit lower than average thanks to the number of ISPs competing, but the speed is a bit lower than average too.
http://www.ispreview.co.uk/index.php/2015/10/mixed-uk-results-in-eu-study-of-broadband-speeds-price-and-coverage.html
The reason I don't have an awesome electric car that I paid £15K new for isn't that Tesla have a monopoly.
>If the UK was uniquely bad in Europe or the world, you might have a point about BT's competence or priorities.
Except that a few countries have worked out that broadband counts as critical economic infrastructure, and the return on government investment puts it far ahead of shiny new trainsets to the North, or a couple of expensive tea services for Number 11.
Which do you think will drive more growth over the next 25-50 years in the UK - high quality broadband for everyone, or HS2?
Which is getting the biggest share of national funding?
Or how about this: spending on roads over the next five years; £15bn.
Spending on broadband: less than £1bn.
See the problem?
g.fast is dead in the water before its even got past trial, it requires an exponential increase in expensive smaller telegraph poles sites/ducting sites (which addtionally require external power, which is still an unresolved cost). Crosstalk issues of g.fast with existing technologies remains a mute point with regard a full scale rollout too. I don't see Google rolling it out in Kansas for their Gigabit network.
Everything you describe, in your attempts to compete against the telco incumbent describe a Monopoly situation, yet you describe Sweetie/BT-EE as not being a monopoly? The only reason a telco can derisk the investment you're making is because they 'are' in an incumbent/monopoly situation, otherwise they would (in a competitive situation) need to competitvely reduce their upfront fees to gain your business to 'compete'. Yet there is no competition, in what you describe.
Sweetie is a monopoly is every definition of the word, the telco incumbent preventing new entrants into the market, by hovering over, announcing potential roll-outs early in areas, then adding delay, after delay, backed by Government subsidies for a technology that is in the interests of Sweetie/BTEE and only Sweetie, to maintain their asset values in their copper investment.
If you ask a company who's majority of assets consist of legacy copper wires what's the best thing to deliver high speed internet, they are going to say Copper. But that's what officialdom did, asked BT and strangely BT recommended FTTC, who'd of thought? Which means we've ended up in a Cul-de-Sac, with FTTC, dabbling in expensive to maintain g.fast technologies, as the recent floods have shown, and will shown again, and that crucially offer nothing for the current notspots.
I also I never said BT was incompetent, I think they are a grand job of milking the officialdom system for every penny they can get and have offered very little different to what they would need to provide anyway to change and remain in business, without the handouts. Not exactly much revenue from Landline calls looking forward is there? - given iMessages, Snapchat, WhatsApp and Skype, Facebook Messenger. What would BT have done without the handouts? Stayed with Home Highway? on your assumption that they aren't a monopoly.
"Everything you describe, in your attempts to compete against the telco incumbent describe a Monopoly situation, yet you describe Sweetie/BT-EE as not being a monopoly? "
Then you failed to understand anything I wrote. KPN weren't abusing a monopoly position - the cost to us of providing fibre last miles was about the same it was for them. The market didn't support the price that would have been needed to make a return.
If BT have no FTTP rollout then how can they have a monopoly in FTTP? They would face the same commercial problem as your new startup would. If BT aren't doing it and their current copper offerings are too expensive, how are they preventing your startup getting off the ground? Fill your boots.
FTTP rollout is hampered globally by high delivery costs and low revenues. That affects the biggest telcos and it affects the smallest telcos. The bigger ones will probably have investors and owners who are used to very slow return - in some other places in Europe the government still owns a stake and so access to low cost long term finance is easier, but the EU tend to growl about that.
Broadband over copper is much, much cheaper than FTTP when the copper already exists. Consumers won't pay more for FTTP versus copper, so no business has an incentive to do it. That's why, globally, technologies like G.Fast will be used to deliver incremental improvements at relatively low cost.
Try to calm down and think harder. Use less 'whataboutery'. Understand that successful deployment and adoption of new technology is primarily a commercial problem. Understand that if you want something that costs lots of money at a very low price and can't have it, the reason is unlikely to be some form of organised conspiracy. Understand that if you can't think of an answer to a technical problem that doesn't mean it's unsolvable - it just means that you can't solve it.
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You cannot be serious.
Never forget, you ALWAYS have a choice. BT, Sky, EE or TalkTalk shouldn't be one of them:
lol, 10 isp's all using BT openreach, real choice there!!!.
All not under control of their own infrastructure, reliant on BT, not restricting them.
BT when rolling out adsl had a nice little trick going on, they would only allow you to have adsl if the line stats were above certain limits, strangely a friend tried to have it installed by another ISP, install day arrives, ho dear, after testing the figures were out of spec so he's can't get it from that ISP, weirdly BT contacted him and said if he went with them he could have it!!!.
Very Strange considering it went over exactly the same line to the same terminating equipment, and nothing was done to the line.
(2 people I know had this done to them within 2 months).
Never forget, you ALWAYS have a choice.
Depends on where you live, just because an ISP serves your area, doesn't mean that they are using anything more than BT/Sky/TalkTalk LLU's, DNS and backhaul circuits...
But then just because they are using say BT Wholesale doesn't mean that the SLA being offered is the same as that being offered by others also using BT Wholesale...
Once you lift the lid, comparing ISP offerings isn't quite as straightforward as some would have you believe. In fact comparing energy suppliers and understanding their bills is comparatively straightforward.
However, the CMA's assertion that BT's takeover of EE has been given the go ahead on the basis that there will still be four mobile operators surely won't sit well with O2 and Three. It suggests that a Three-O2 merger may be blocked, as that would reduce the number of mobile operators from four to three.
Might O2 and Three have a case when they claim that they must be allowed to merge in order to realistically compete with the BT-EE behemoth?
Regardless of the BT/EE case, Three, through their previous EU sanctioned takeover of O2-IRE, already have a good case if the EU blocks their takeover of O2-UK (where Three have already implemented many of the competition demands the EU made when it approved the O2-IRE deal), because the EU will need to give reason as to why the UK market is different from the Irish market and, given the likely sequence of events, why the UK market is different to the French market where the four are likely to become three in 2016...
...broken up many years ago to stop this type of thing (this is where BT came from)?
And also, anybody in the know, please tell BT I DO NOT WANT THEIR SUPER FAST BROADBAND AS I AM A SPECIAL CUSTOMER spam snail mail letters twice a week as I already have a super duper connection anyway. Surely they know that?
"I already have a super duper connection anyway. Surely they know that?"
Ah yes, but they don't just provide run of the mill <insert-superfast-adjective> broadband, they offer Infinity - no one can trump that ;)
Note to self: Must take that up with Advertising Standards. Bummer, that's OFCOM these days - aren't they already pawned by BT?
Thats me gone then, I ditched BT a few years back due to the continuing failure of BT group to actually maintain my landine hiding behind the pathetic assertion that Broadband service quality is not guaranteed on a reasonably short line that hasn't carried a voice call in years - which is the ONLY reason for this line existing.
I have no intention of sticking around while "the synergies of both companies are brought together", and result in a bigger steaming pile than BT is already. I'm sure it wont be long before the Customer service experience is given an overhaul and given that I am currently immersed in the BT one for a colleague who has had dead BT internet since early December - and now also has a dead landline - I'm porting my number, I have no intention of adding to my grey hairs trying to deal with another "BT" company.
The BT group needs splitting up not building up - Openjoke needs to be a separate stand alone company, without the ridiculous insulation from end user accountability as they have now - I pay for the line - when Openjoke cant fix it, or bill me for an exchange fault (as they have done in the past) I should be able to bend their ears about it - not be dealing with my ISP who are purely a messenger boy in event of a fault. Given BTs love of crap like Call connection fees (why? the equipment does it - we are past the days of Mabel plugging in jack cords), and the likelihood of being a second class customer with higher fees if you don't take the full multiple play bundle, I'm going now!
Looks like we will soon be as screwed over in the mobile market as our Cousins across the pond, Bigger isnt better, But in true British fashion once again a regulator/watchdog has failed to look out for the customer interests.
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