Another one bites the dust…

Belgium will not be getting a fourth 3G operator after all.
| PolicyTracker

Europe’s mobile market just got a little less competitive. Telenet and VOO, the Belgian cable operators who won a 3G licence back in 2011, have confirmed what many had suspected for some time: they won’t be using their 2.1 GHz spectrum to launch a network after all.

The reason for this is pretty obvious. Attempting to launch a new mobile network in a small market of 11 million people that is already served by three well-established operators would be a spectacularly bad idea.

The two companies did not use those exact words, however, saying only that market conditions have changed and they have had a hard time getting permits to deploy wireless towers.

They must have thought it was a good idea once, though. Working together through a vehicle called Tecteo Telenet Bidco, they paid €71.5 million (€20,833 per MHz per month) to use 2 x 14.8 MHz of spectrum for 20 years.

Perhaps they were encouraged by Ofcom’s view of the UK. Before that country’s 4G auction, which eventually took place in 2013, the regulator decided that at least four “credible” operators was the appropriate number of market players, based on various technical, economic and competition considerations.

That was before it became obvious which way the wind was blowing. Look at Germany (population: 80 million), which is now on the verge of becoming a three-operator market. France is very likely also to go down that road. In Spain, Vodafone may be considering a bid for Yoigo. If France, Germany and Spain cannot sustain a four-operator market, how can Belgium?

But what may be bad news for competition at national level may be good news for the European Commission’s “connected continent” agenda. A single European telecoms market implies fewer, larger operators. So while it is a shame to see any new venture come to a halt before it even launches, Brussels at least will probably be relaxed about it.

Before a pan-European market emerges, more operators may well have to bite the dust – or be swallowed up by larger rivals.

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