Vodafone, 3 Australia try to allay monopoly fears

Vodafone Australia and Hutchison 3G Australia Pty Limited (3 Australia) have reassured customers that they will get same or even better value deals after the completion of the proposed merger between the two companies.

According to a statement jointly issued by the companies just days ahead of its final clearance from the Australian Consumer and Competition Commission (ACCC), it said "all new and existing contract customers of Vodafone and 3 will be able to enjoy the same great value offered on all existing Vodafone and 3 mobile voice and data plans for the next 2 years".

ACCC is likely to deliver its decision on the merger proposal on 29 May. It previously voiced concerns that the joint venture may lead to increased prices in the mobile phone market.

The proposed merger has already received the support of Huchison shareholders, Australia's Foreign Investment Review Board and the European Commission.

Monday's statement is expected to allay fears that the combined telecommunication entity will monopolise the Australian market, which also has big players such as Telstra and Optus.

"We have responded to the ACCC's statement of issues and their requests for information, in particular expanding on our view that the merger will deliver more competition, a better deal for customers and more investment in the mobile market," said Dews, CEO of 3 and proposed CEO of the new company Vodafone Hutchison Australia (VHA) at the company's annual general meeting on 19 May.

"We operate in a fast-moving market and we want to be clear that, following the merger, Vodafone and 3 will remain extremely competitive and continue to provide great value to customers," Dews said in the joint statement.

"We're happy to reassure our customers with a public commitment that if the merger proceeds as intended, no plan will be withdrawn from market for the next two years," explained Dews, adding that during this time the firm will also introduce new offers and services to appeal to new customers.

"Vodafone and 3 customers have everything to gain from the proposed merger," Dews said.

"VHA will be a stronger mobile operator that is better positioned to compete in the Australian telecommunications market. We plan to draw on the best offerings of Vodafone and 3 and will continue to provide innovative consumer and business services to the Australian market," he added.

"For competitive reasons we will not telegraph our full roadmap of handset and mobile broadband products and prices, but VHA will certainly introduce new offers into the market to acquire new customers," the statement said.

Hutchison posted a net loss of $163.10 million for 2008, a 43 per cent improvement on the loss of $285.1 million made in 2007.