When the deal was first mooted my stockbroker advised me to sell BT shares. Once the deal was consumated and Vodafone had started paying for the upgrade investments that are long overdue, he expected to see BT's backhaul revenues stagnate as they faced real competition for the first time in a decade. BT would also face a double whammy as Vodafone and Telefonica/O2 competed to offer ubiquitous broadband (fixed and mobile) across the Urban markets of the UK, decimating the fixed line revenues of BT and Virgin.
Sir Humphrey's dream of a return to a monopoly telecoms infrastructure for monitoring and surveillance, as well as regulation, lies in ruins (unless the agony is prolonged by disappointed Cable and Wireless shareholders seeking a better price from another suitor). The Leveson enquiry may have temporarily crippled the UK's other world-class communications provider - Sky. But already we can see a return to an effective duopoly with other serious competitors in the wings.
I think my stockbroker was wrong about the long-term effect on BT's share price. There is more than enough business for all. But local councils pondering the BDUK framework will almost certainly get a better deal if they ensure their investments in community broadband (urban or rural) require the use of global inter-operability standards so that they can multi-source across operators on a non-exclusive basis. in this context they should take another look at the small print of the Westminster Council deal with O2. It is much much more elegant solution than the BDUK framework in its current state.
Are we about to see another case of market forces overcoming regulatory failure?