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Next Round in Merger of Telekom Austria and Yesss!

The Austrian Competition Authority has applied for an inquiry of the merger between Telekom Austria and Yesss! in the Cartel Court.

Neither one of the merging parties had been able to clear the BWB’s initial concerns. The BWB regrets to inform that the inquiry will thus proceed into the next phase, since the BWB continues to suspect potential and serious disadvantages for the Austrian markets and consumers. This next phase may potentially last at minimum another five months.

Creation of a Market Dominant Position in Multiple Markets

The merger affects multiple markets that have direct consequences for consumers. So would, for example, Telekom Austria’s market share of telecommunications rise to more than 39%.

In the market segment “landline plus mobile (private customers)” the market share of TA would be greater than 53% post merger.

Serious Disadvantages for Consumers

With the disappearance of Yesss!’s aggressive pricing strategies, the only competitor of TA’s brand “bob” would fall away. The result feared by the BWB is an increase in pricing, since the competition in the Prepaid-Segment would cease to exist.

Economic Connection to Hutchinson 3G and Orange

The merger of Telekom Austria and Yesss! is closely related to the fusion of Hutchinson 3G and Orange that is currently being handled by the European Commission. In this case there are also many concerns to be found.