The UK’s Competition and Markets Authority (CMA) is launching a major investigation into the £15bn merger of Vodafone and Three due to concerns about potential price hikes and reduced service quality for mobile phone users.

Vodafone and Three failed to offer any solutions to ease the CMA’s concerns, leading to the initiation of the investigation.

The proposed merger aims to create the UK’s largest mobile network by bringing together 27 million customers under a single provider.

Regulators worry that the merger could diminish competition and hinder investment in the mobile market.

Vodafone and Three argue that the merger will lead to increased investment and better competition with major rivals, BT/EE and Virgin Media-O2.

The CMA’s investigation will take at least 24 weeks and could potentially block the merger.

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The CMA previously described Three as the cheapest of the four mobile network operators, and the merger could jeopardise this affordability.

Concerns raised include that the deal might disadvantage smaller ‘virtual’ operators like Sky Mobile, Lebara, and Lyca, making it harder for them to negotiate favourable deals for their customers.

The CMA has set a deadline of 18 September to complete the in-depth investigation.

Vodafone and Three expressed confidence in the merger’s benefits, asserting that it will enhance competition and improve network quality, speed, and coverage.