The European Commission has unconditionally approved the acquisition of cable operator UPC Austria by mobile network operator T-Mobile Austria, a subsidiary of Deutsche Telekom.
The Commission concluded that the transaction would raise no competition concerns as the companies’ activities and assets are largely complementary. UPC’s main activities are related to fixed-line telecommunications while T-Mobile is mainly active in mobile telecommunications.
The Commission examined the impact of the proposed transaction in the limited number of markets in the fixed and mobile telecommunications sector in Austria where the activities of both companies overlap. In particular, they are both active in the provision of internet access services for residential customers.
However, the Commission found that the impact of the transaction on this market is likely to be limited, considering in particular that UPC’s fixed internet access products differ considerably from T-Mobile’s mobile broadband products. These products differ both in terms of the underlying technology and product characteristics and as a result are not closely competing, according to the competition authority.
The Commission also found that the merged entity would continue to face significant competition from other players such as the incumbent A1 Telekom Austria and Hutchison Drei Austria.
Additionally, the Commission examined a number of vertical and conglomerate relationships in the fixed and mobile telecommunications markets in Austria arising as a result of the transaction, in particular concerning bundled multiple play services. The Commission concluded that the merged entity would not be able to use its market power to shut out or marginalise its fixed or mobile competitors by bundling fixed and mobile products.
Therefore, the Commission concluded that the transaction would raise no competition concerns in any of the affected telecoms markets and cleared the case unconditionally.
The purchase of UPC Austria, the country’s largest cable operator, for around €1.9 billion from parent company Liberty Global was announced in December 2017. Through the acquisition, T-Mobile will gain a strong foothold in the fixed-line market, enabling the company to offer quadruple play products to its customers: TV, internet, fixed-line telephony and mobile services.
