The industry claims that consolidation can help boost investment in new infrastructure and delivery of mobile broadband to rural areas. It called on regulators to focus more on the economies of scale created from mergers and how this can increase operators' capacity and willingness to invest.
The report also rejected fears of higher prices due to fewer operators, saying "there is no robust evidence to suggest that four-player markets have produced lower prices than three-player markets in Europe over the past decade". Regulators were also focusing too much on the Gross Upward Pricing Pressure Index; the GSMA report claims that GUPPI analysis "has proved unreliable when estimating the impact on unit prices expected to result from mobile mergers".
Evidence from the recent Austria merger confirms unit prices did not increase as authorities had anticipated, it added. Mergers can accelerate the adoption of new cycles of technology, which can actually bring down prices as well as improve service quality.
The GSMA also argued against the idea that network sharing can achieve the same effects for operators as mergers. Network sharing offers weaker incentives to invest, as there is little competitive advantage to gain when at least two operators have access to comparable networks, it noted.
Finally, the report cautioned against regulators imposing remedies on mergers such as access to networks by third parties, as this could also reduce the incentive to invest and reduce the benefits of scale achieved by the merger.
