Vodafone and O2 have both offered Deutsche Telekom around
£3.5bn for its UK mobile network operator T-Mobile UK. The bids
value T-Mobile's subscribers at £210 each.
Computer Weekly
reported in June that Deutsche Telekom was looking to sell its
UK subsidiary. T-Mobile, with about 15% market share, is the
smallest of the five mobile network operators in the UK.
This morning, Ofcom reported that revenues for all mobile
network operators were down in the first quarter. T-Mobile lost
440,000 subscribers compared with the first quarter of 2008. This
would squeeze profit margins.
If either Vodafone or O2 were to buy their rival, it would make
it the clear leader by market share in the UK. According to Ofcom's
figures, which do not include 3Mobile, a deal would take either
close to 50% of the market.
Mobile network operators are also under pressure to invest more
to deliver a 2Mbps broadband service under the government's Digital
Britain plan. This is likely to hasten a deal.