Telecoms Merger in Austria Could Open Door to Further Consolidation

For nearly a decade, financial analysts have expected a wave of mergers and acquisitions to sweep Europe’s fragmented telecommunications sector, consolidating the region’s 102 mobile operators and creating a more efficient market. But for years, the telecommunications landscape has remained largely unchanged, with three or four operators still fighting winnowing, zero-sum battles to steal customers from one another in saturated national markets.

This month, the European competition commissioner, Joaquín Almunia, is expected to approve a combination of two mobile carriers in Austria, 3Austria and Orange Austria, reducing the number of network operators in that country to three. But it could also set a precedent that makes other telecommunications takeovers easier, said Beranger Guille, an editor in London at Mergermarket, an information service covering mergers and acquisitions.