A merger between Vodafone UK and Three UK is still possible, an analyst claims

In May, The Financial Times reported that Vodafone UK and Three UK have been discussing a possible merger. However, it's now September, and it doesn't appear that unification between the two is on the horizon. Nevertheless, as Fierce Wireless first reported, according to Counterpoint research analyst Charu Paliwal, a union between the two mobile operators could indeed be on its way.

In a blog post, Paliwal stated that a merger between Vodafone UK and Three UK could still happen. The analyst claims that due to the ban on buying equipment from Chinese companies like Huawei and ZTE, both carriers have "weakened bargaining power" in acquiring 5G equipment. Also, investors are pressuring Vodafone to improve its returns, and Three's revenue has been flat for the last few quarters.

As Paliwal said, unification in such conditions lets companies increase their subscriber numbers and lower their cost of operation. So by becoming one carrier, both companies will achieve that and create, as she stated, a "market-leading entity."

However, Paliwal couldn't say when we could eventually expect the two carriers to become one. There is no official word from the companies about an upcoming merger, and if one does happen, according to Paliwal, it will be a "long shot" because regulatory bodies will try to impose strict control over it. But, Paliwal thinks that after the "close scrutiny," regulatory bodies will approve the unification of the two carriers.

We must note that Vodafone currently holds about 20% of the UK mobile market, and Three has around 10% of the market. So if they really do merge, they will hold 30% of the mobile market in the UK. Just for comparison, Virgin Media O2 currently has around 28%, and EE has about 26%. So, a fused Vodafone and Three entity would be catapulted to the top spot of the UK mobile market.

We don’t know how such a merger would affect the different monthly deals and the perks these companies offer to their customers. If you want to know what the latest offers from the UK carriers are — check out Best Vodafone Phone Deals and top Three mobile phone deals. And if you are using the services of another UK carrier, feel free to go to our best EE phone deals, top O2 deals, and best Virgin Media deals.