H3G Austria offers free internet access in bid to sweeten regulators

10 Aug 2012

Hutchison Whampoa’s H3G Austria unit has launched an offer of free internet access in the country, possibly in a bid to help secure regulatory approval for its proposed EUR1.4 billion (USD1.87 billion) takeover of fellow Austrian cellco Orange Austria. Reuters writes that in the bold move by Hutch – which is well known for disruptive pricing in all its European markets – comes as it seeks to demonstrate to regulators in Brussels that it would remain a champion for competition even if it took control of its rival. Under the plan, H3G Austria is giving away free SIM cards plus 20MB of data (per day), it said.

According to TeleGeography’s GlobalComms Database, European Union (EU) regulators are considering allowing the takeover, so long as the combined entity allows other local operators to access its network as mobile virtual network operators (MVNOs). However, sceptics point out that the EU solution fails to address the chief objection from Austria’s federal competition authority, Bundeswettbewerbsbehorde (BWB), which apparently objects to a clause in the deal which would see H3G sell MVNO Yesss! to A1 Telekom Austria immediately after the transaction; the transfer of 750,000 Yesss! subscribers would allow Telekom to boost its market share to around 47%. If the anti-monopoly agency decides to formally block the transfer of the FT-Orange assets to Telekom, Hutch is understood to be prepared to walk away from the deal.

The Austrian wireless market is currently home to more than a dozen well known MVNOs and airtime resellers, including Schwarzfunk, Yesss!, eety and Red Bull Mobile (formerly aonMobil).

Austria, CK Hutchison, Hutchison Drei Austria, Orange Austria