O2 first to offer Surface 3 4G to business customers

O2 signs three month exclusivity deal with Redmond. Meanwhile M&A activity heats up in telecoms market

O2 is to become the first telecoms company to offer the Microsoft Surface 3 4G LTE to its enterprise and small business customers.

The three-month exclusivity deal comes on the back of the news that O2 is Microsoft’s largest syndication partner in the UK for reselling Microsoft Office 365.

As the mobility revolution surges ahead, Microsoft hopes that it can capture a rapidly emerging segment of the market; namely the folks for whom an ultrabook is simply too cumbersome.

The Surface 3 4G LTE will come in two primary flavours: 64GB and 128GB, both with 4GB of RAM and running Windows 8.1 Professional. A free upgrade to Windows 10 will be provided if and when it launches later this month.

Ben Dowd, O2 Business Director said, “We’re proud to be the first to market in the UK with the Microsoft Surface 3 4G. At O2 we’re always looking for ways to give our customers the best in class digital products, services and applications, so they can experience the benefits of having the latest technology at the heart of their business. The Microsoft Surface family is a fantastic example of this and I hope our customers are as excited as we are to start using the new devices.”

M&A news

In other news, as talks progress between O2 and Hutchison Whampoa, the EU competition commissioner Margrethe Vestager has warned that any such deals will be put under the microscope. Should the £10bn deal go ahead, it will form the largest telecoms group in the UK. Speaking at an event in Paris, Vestager was clear that the commission would be scrupulous in its investigations of such mergers, regardless of the industry’s expectations.

“Incumbent operators argue that if they cannot merge with their rivals in the same country they will be unable to increase their investment. I’ve heard this claim quite often, but I have not seen evidence that this is the case,” she said.

“Instead, there is ample evidence that excessive consolidation may lead not only to less competition and more expensive bills for consumers, but that it also reduces the incentives in national markets to innovate.”

The telecom giants had hoped that the merger between Telefónica and E-Plus in Germany last year would set a precedent, but Vestager’s comments suggest that getting approval may not be plain sailing.

Hutchinson is expected to file its proposal with Brussels in September.

Meanwhile, Vodafone has confirmed that it is in early stage talks about ‘swapping assets’ with the owner of Virgin Media, Liberty Global.

Analysts have been quick to point out that should the deals between BT and EE and O2 and Hutchinson go ahead, Vodafone would come crashing down, becoming the smallest player in the UK market.

Rumours that a possible merger between the Liberty Global and Vodafone were quashed somewhat last month when the UK group issued the following statement to Bloomberg.

“Vodafone confirms that it is in the early stages of discussions with Liberty Global regarding a possible exchange of selected assets between the two companies. There is no certainty that any transaction will be agreed, nor is there certainty with respect to which assets will ultimately be involved. Vodafone is not in discussions with Liberty Global concerning a combination of the two companies.”

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