Christian Louca
By Christian Louca, Managing Director of YOC.
Usually, the merger of two major companies in any influential market is seen as a threat to consumer choice.
The conventional wisdom is that less competition means reduced pressure on prices, which translates to fewer pennies in your pocket.
But when it comes to the merger of Orange and T-Mobile, cleared by the OFT (March 1, 2010), arguably it means a lot more choice for its customers, not less.
Firstly, the merger should deliver an expanded, and more robust 3G service to UK customers. Why is this important?
Well, 3G has become fundamental to the development of the mobile data economy which has exploded over the past two years as smartphones have expanded well beyond the niche subscribers who had historically owned them in the days where 3G coverage was patchy and unreliable.
Smartphones and fast data have become inextricably linked, meaning that data-rich services, streaming media and location-aware apps depend on continuous connection.
If the result of the merger is increased 3G coverage and faster data speeds, then this will be a massive boon to both the mobile companies that are driving innovation in the mobile market with a slew of new services which simply aren’t possible without it.
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Better and faster coverage also means that connectivity can become ubiquitous. At last month’s Mobile World Congress in Barcelona wireless was showing itself in plenty of new form factors – from connected cars to e-readers, smartbooks and even mobile-enabled heart monitors.
There are thousands of potential ways where mobile connectivity can bring new life to an existing device or service. But the risk of doing so isn’t worth it to companies unless they know that the networks that deliver the connectivity are able to cope with the new demands placed on them.
That’s where bigger and broader networks arguably become essential to justify taking a wireless gamble.
But potentially the biggest boost from the merger would be to retail, and specifically m-commerce. Mobile retail is the glue that sticks together mobile marketing, advertising, search – you name it, and somewhere in the value chain will be a company or brand that depends on making a sale.
The more consumers trust m-commerce, the more this whole ecosystem around m-commerce can thrive and invest in new services based around location, personalisation and recommendation can redefine how and when we shop.
The rise of the app store has done a lot to make m-commerce appealing, but the success of the application has been to create a consistent and robust gateway to the mobile Internet.
If there is less need for the gate-keeper, it means it’s easier, cheaper and quicker for retailers to offer services that are created for and tailored to a mobile experience.
Gone are the challenges of app-store fragmentation and the time and cost of approvals, and instead the true potential of m-commerce and everything that goes with it can be unlocked.
It may sound strange but in this case, less competition does mean more choice, more innovation and a great opportunity for everybody. And it’s not often that you can say that about the mobile industry.
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