Vodafone-Three merger: What will it mean for connectivity in the UK?

Parts of the telecoms industry wait with bated breath for the long-awaited outcome of the proposed merger between Vodafone and Three. It’s predicted that the decision will be announced by 7 December 2024.

Whilst the formal decision is awaited, indications are that the merger is likely to be given the green light by the Competition and Markets Authority (CMA) following further publication of competition remedy proposals which are currently under consideration and viewed sympathetically.

This significant move will see the creation of the UK’s largest mobile phone operator with significant network investment planned (estimated at £11bn) and the potential for the creation of Europe’s largest 5G standalone network.

For those of us in the deployment space, this is of course welcomed news. But the key question is: what will this really mean for connectivity in the UK?

Further drive still needed to improve connectivity across the UK

The Vodafone-Three merger, and the significant infrastructure updates that will follow, can only be a good thing for connectivity in the UK. It drives the desired step change to bring the UK where it needs to be in terms of connectivity and innovation.

According to the United Nations 2024 E-Government Survey which compares countries on digital infrastructure, human capital and service provision, the UK’s latest score has seen it rise into the top ten for the first time in four years to rank in seventh place. While this is all movement in the right direction, is seventh place really good enough?

It is clear that there is still a lot to be done in terms of driving digital infrastructure improvements and connectivity inclusion and access across the UK, especially when you compare our credentials to the three front-running countries: Denmark, Estonia and Singapore.

Despite how advanced we think the UK is, we are still seeing some eye-opening statistics around digital poverty and lack of access to broadband, digital devices, mobile signal coverage and data. A report produced by the Good Things Foundation estimates that 3.7m households in the UK with children do not meet the Minimum Digital Living Standard. Furthermore, it is thought that approximately 2m UK households are impacted by data poverty and struggle to afford access. So, it is clear that there is still a lot of work needed to be done to eradicate digital poverty and close the divide.

But why is improving connectivity so important?

Any initiatives that lead to improvements for the UK’s digital infrastructure are more important than ever before. Our country relies heavily on connectivity and there are many benefits to reap for business, education, and health and well-being. We are seeing an increase in services being hosted online and so a lack of digital access will restrict many. For example, medical providers offering virtual GP bookings and appointments, as well as access to prescriptions. This is key for vulnerable members of society or those in remote locations. There are many who may be unable to travel, too unwell to attend in-person appointments, or may simply need out-of-hours access.

Online appointments open up support to a much wider audience, but this service only works for those who do have access to digital devices and connectivity. Additionally, for those who are remote or living on their own, the digital world can play a significant role in supporting mental health and well-being by providing vital social connection to prevent isolation.

Of course, this is on top of the obvious educational, economic and business benefits in terms of home schooling and working which has become the norm for many in society. There are many children who supplement their unique educational needs with home learning and lack of access to devices or internet/data at home will see them disadvantaged compared to peers.

Increase in 5G case studies for local authorities

As well as benefits and resilience for business, education and well-being, the early adoption of technologies can significantly enhance public and private services, and the monetisation of them in times of austerity challenges or unplanned events.

As a result, we have seen an increase in 5G case studies and Gateley Hamer has been working closely with local authorities, including West Midlands 5G, on connectivity enabling initiatives.

The case studies are a prime example of how the adoption of connectivity and smart city mindsets e.g. Sunderland and Norwich, can drive net zero goals through enhanced intelligence gathering via data capture methods for smart grids, pollution monitoring and transport management.

As well as the improvement and accessibility of services, connectivity increases economic benefit through Digital Sector Gross Value Added which was estimated to be approximately £161bn for the 2023 calendar year. This is also an important economic hedge in a time of unpredictability in other sectors.

Proposed eight-year infrastructure programme will bring many benefits

So, when you consider the economic, social and health benefits of connectivity, it is clear that the Vodafone-Three merger will bring 5G case studies to life and will be a key part of the emerging technological revolution for the UK. There will be plenty of opportunity for local authorities to achieve significant social and economic benefits through the infrastructure growth it will generate. Plus, the proposed eight-year programme for upgrading digital infrastructure will create stable job opportunities and stimulus to retain and grow key talent in the sector.

Key stakeholder investment needed to achieve outlined goals

However, the industry must remember that despite its size and significance, the Vodafone-Three merger on its own is not enough in terms of improving connectivity for the UK.

To truly improve our infrastructure, eradicate digital poverty and close the digital divide to reap the many social and economic benefits, the industry still needs key stakeholder collaboration.

The adoption and enabling of a ‘can do’ collective mindset needs to stem from within local authorities to ensure they are operationally ready. Regulatory policies also need to be supported to ensure we are achieving an aligned and cohesive national connectivity strategy. So, while the Vodafone-Three merger is a very welcomed step in the right direction, the industry shouldn’t get complacent as we still have work to do.