EU Approves Mobile Payments Joint Venture by UK Mobile Networks

Published on: 5th Sep 2012

­The European Commission has approved the proposed mobile payments joint venture between Vodafone, Telefónica and Everything Everywhere in the UK.

The country's other mobile network, Hutchison 3G UK is not part of the venture.

The Commission's preliminary investigation had indicated potential competition concerns in the emerging markets of mobile payment applications supply (so-called "mobile wallets"), mobile advertising and related data analytics services.

As a result of its investigation though, the Commission concluded that the joint venture will not likely lead to a significant impediment to effective competition in the EEA within the meaning of the Merger Regulation.

"Mobile commerce is a nascent sector that may radically change the consumer buying experience in the next few years. The proposed joint venture is one of several initiatives to develop the sector in Europe. The Commission is keen on promoting innovation in this area and ensuring that the markets remain open so that a number of competing solutions can emerge without undue obstacles, to the benefit of consumers." said Joaquín Almunia, Commission Vice President in charge of Competition policy.

The market investigation revealed that a number of alternatives already exist and much more are very likely to emerge in the near future to ensure adequate competitive pressure on the joint venture's mobile wallet platform. Some of these alternatives may rely on a secure access to the SIM card of the mobile handsets in order to store sensitive data like bank account numbers, etc. This access will be controlled by the mobile network operators, including in particular the three parents of the joint venture. However, other alternatives exist which do not store sensitive data on SIM-cards and it is unlikely that the creation of the joint venture will allow the parent mobile network operators to block these alternative routes to market using technical or commercial means.

As regards the joint venture's advertising and data analytics activities, the market investigation revealed that there will be various other players who have access to a comparable set of data and who will offer services in competition with the joint venture.

 

Tags: [mobile payments]  [european commission]  [UK]