Three UK’s chairman today pledged that the network will freeze the price of calls, texts and data for a whole five years if its mooted merger with O2 goes ahead.
The network is in the midst of a battle to show why the deal should be approved, so it’s no surprise that enticing promises are being made.
But if you’re on Three, what does it really mean for you? Read on and we’ll tell you everything you need to know.
What’s the offer?
In a letter to the Financial Times, Three UK chairman Canning Fok said explicitly that prices of calls, texts and data would not rise for five years if his network gets its wish and merges with O2.
So contract prices will be frozen?
Not so fast. Fok appears to be talking about unit prices here, which are the basic price paid for making calls, sending texts and accessing online services via mobile data.
When bundled up into contracts, though, these prices don't mean too much.
That's because contracts tend to focus on how many ‘free’ minutes, texts and data you get, with per unit prices rarely entering the equation.
Consequently, monthly contract prices could still change over that five year period.
But there could be savings?
Yes. Fok seems pretty keen to make it clear that Three customers will benefit from the merger.
As well as making his price freeze promise, he also pledged that any savings made from the deal between O2 and Three will be passed on to users.
That should mean that contract costs will stay low.
Why is Three making this statement now?
Basically, the merger deal is facing huge obstacles.
Competition regulators in the UK and the European Union appear to be less than impressed by the idea of Three and O2 coming together and are worried it will drive up prices and create a huge network that rivals could not go toe–to–toe with.
Bureaucrats are concerned that a network which would have 40% of the market could push up prices and kill off smaller networks, such as GiffGaff and KC Mobile, because of the demise of O2.
So what else is Three offering?
Plenty. Three says it will invest £5 billion in infrastructure in the first five years after a deal is finalised, a hike of 20% compared with what the networks would spend separately in that time.
There are also plans to allow smaller networks to buy part of its infrastructure, rather than simply renting it.
What about current Three bills?
At the moment, Three and O2 remain separate. That means that this offer won’t come into force unless regulators give the merger the thumbs up.
In the meantime, Three has just announced that selected two–year–old contracts are doubling in price from costing £15 per month to £30 per month.
This latest statement from the network isn’t just aimed at regulators, then.
It's also intended to placate and reassure disgruntled consumers who want to know why Three is putting prices up well ahead of any deal with O2.
Got any more questions for us? Let us know in the comments section below.