What does the BT/EE hook-up mean for you?

BT has bought Britain’s biggest mobile network group, EE, after agreeing a whopping £12.5 billion price tag.

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EE customers will remain on their existing contracts for now. No changes to contracts, service provision or branding (including EE's 500-plus shops) will take place until at least March 2016, when the transaction is finalised - and assuming it is given the green light by the telecoms industry regulator and competition authority.

BT exited the mobile phone market in 2003 when it sold Cellnet - now operating as O2. It has re-entered the market after completing the purchase of EE from Orange and Deutsche Telekom.

It is paying £12.5 billion in cash and shares for the network. Deutsche Telekom will retain a 12% stake in BT and appoint a member to the BT board. Orange will hold a 4% stake in BT and pocket over £3 billion.

What does it mean for you?

That’s all the businessy stuff, but what exactly could it mean for EE’s 24.5 million mobile customers?

Quad-play to the fore

The deal reflects growing interest in ‘quad-play’ – the ability of telecoms firm to offer landline (increasingly known as 'fixed'), broadband, TV and mobile services.

Adding mobile to its current portfolio would elevate BT to the forefront of this sector. EE customers can expect to receive promotional offers from BT, inviting them to take up additional services.

Virgin Media is the only other big competitor offering quad-play bundles at the moment, so it’s sure to be paying close attention to the BT deal.

Increased competition?

With a new quad-play provider in town following a BT/EE merger, we should see increased competition and lower prices.

But, speaking of competition, industry watchdog Ofcom will probably also be paying attention to the deal, because of the sheer size of both groups and the fact that BT owns miles and miles of the UK’s telecoms infrastructure.

The Competition and Markets Authority will also have to approve the transaction.

All four one

Gautam Srivastava

Gautam Srivastava, communications expert at MoneySuperMarket, said the deal will be great news for customers, and that EE’s 4G network would be a boon for British Telecom: “This is a hefty commitment from BT in their bid to be the quad play provider of choice.

“Currently only Virgin Media and TalkTalk offer all four services with none doing all well – BT is aiming to change that and become the first true one-stop-comms-shop.

“There are numerous advantages for customers who have all their communications with one provider. BT customers will have the ease of having only one bill to navigate each month across their services, plus BT will be able to offer ‘bundles’ – which should mean cheaper prices for customers across the board.

“But beware; one potential disadvantage for customers would be that they would be bedded-in with BT – meaning if they weren’t happy with one of the services they were receiving they could find issues in moving to a new provider.”

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