EU, Hutchison showdown to take place today; Hutch unveils UPC as MVNO partner

10 Oct 2012

Hutchison 3G Austria (H3G) representatives will meet with doubting European Union (EU) regulators later today in a last-gasp bid to convince them of the merits of Hutchison Whampoa’s proposed EUR1.40 billion (USD1.87 billion) bid for France Telecom-Orange’s Austrian mobile unit. According to Reuters citing a person familiar with the matter, H3G chief executive Jan Trionow and Hutchison 3G Europe’s deputy chairman Christian Salbaing will argue the case for the company at the private hearing.

In related news, Hutchison 3G Austria has confirmed that UPC Austria will be permitted to piggyback on its network as a mobile virtual network operator (MVNO), Total Telecom reports. The move forms part of its strategy to appease European Union (EU) antitrust regulators who are scrutinising the deal. In August this year Hutch pledged to offer ‘favourable and comprehensive’ MVNO access as a way of enhancing, rather than inhibiting, competition. For its part UPC plans to initiate commercial services ‘as soon as possible’. H3G’s CEO Jan Trionow commented: ‘We believe that our MVNO wholesale rates are among the most attractive available in Europe, and are confident that other players will come forward to take it up. I hope that regulators in Brussels and Vienna will share our view that this is a major contribution to the competitive landscape in Austria’.

According to TeleGeography’s GlobalComms Database, 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). Complicating matters further, Austria’s federal competition authority, Bundeswettbewerbsbehorde (BWB), has previously stated its objections to a clause in the EUR1.40 billion 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 market leader Telekom to boost its market share to around 47%. Curiously, the EU regulators have no objections to this aspect of the increasingly convoluted process.

Austria, Hutchison Drei Austria, Orange Austria, UPC Austria