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Dixons Carphone is starting its own mobile phone network. The newly merged company that owns high street gadget and phone shops Currys, PC World and Carphone Warehouse is joining forces with Three for the network.
Although it’s yet to be named, the new network is due to launch in spring. It’s expected to offer data connection for devices including smart home appliances.
The new network will be a mobile virtual network operator (MVNO), which means it will present itself to customers as a separate network but behind the scenes will use masts and other infrastructure belonging to a major network. In this case it’s Three providing the hardware; other MVNOs include Tesco Mobile, which uses O2 masts, and Virgin Media, which uses EE.
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Mobile market shake-up
- BT agrees to buy EE for £12.5 billion
- Three owner agrees to buy O2 for £10.25 billion
- Sky to launch own mobile network and take fight to BT
- Dixons and Carphone Warehouse merge, promise no shop closures
- Phones 4U in administration as Vodafone denies acting ‘inappropriately’
Carphone Warehouse merged with Dixons in a £3.7 billion deal last summer to form Dixons Carphone. Carphone Warehouse stores have since been left as the main independent high street retailer for mobile devices since Phones 4U folded late last year after the networks pulled out. Meanwhile Currys and PC World have outlasted defunct rival gadget shops such as Comet and Best Buy.
2015 is set to be a year of huge changes in the mobile network landscape. BT is set to create a broadband, landline, TV and mobile behemoth by buying the largest network, EE — itself formed from a merger of Orange and T-Mobile a few years before. Three’s owner Hutchison Whampoa is snapping up O2, while Sky is planning an MVNO to round out its broadband, landline and TV portfolio.
A reduction in the number of major networks from five to three could spell less competition — and therefore higher prices for customers — but the announcement of new MVNOs could even that out.
“The launch will further intensify a highly competitive MVNO market in the UK,” says industry analyst Kester Mann. All of these manoeuvres are subject to approval by telecoms watchdog Ofcom, but Mann believes this latest tie-up “could help smooth the path of regulatory approval for the Three and O2 deal”.
