European telecoms regulators' fears over in-market consolidation bringing higher prices for consumers are misplaced, Vodafone CEO Vittorio Colao insisted on Monday.
"The concern on pricing is overblown," he said, speaking to the media on the sidelines of Mobile World Congress.
When looking at the potential impact of a merger deal, regulatory authorities should recognise that price is not the same as consumer spend, Colao said. In many cases, consumers are spending around 3%-5% more in return for 60%-70% growth in usage, he explained, while in others Vodafone wishes it could reach that 3%-5% mark.
"To me, it looks like an excellent deal," he said. "We should look at the overall customer deal," rather than headline prices.
The desire to mitigate the impact on the consumer wallet is usually the main focus of national competition regulators and the European Commission when it comes to deciding the fate of proposed M&A deals.
Five months ago European competition commissioner nixed Telenor and TeliaSonera's plans to merge in Denmark with a view to preventing a reduction in competition and the imposition of higher prices on consumers.
Austria is often cited as a market in which prices have risen following the 2013 acquisition of Orange's local unit by Hong Kong's Hutchison.
Not so, Colao believes. "[Prices are] going down everywhere, including Austria," he said.
Nonetheless, Colao has few complaints about the European Commission's track record when it comes to mergers.
"I don't think the Commission has been too aggressive with its stance," he said.
"In Denmark there was a certain market structure," that gave the Commission cause for concern, he said. "In Italy it's a different case."
Hutchison Europe and Vimpelcom formally notified the European Commission of their intention to merge their Italian fixed and mobile businesses, Wind and 3 Italia respectively, earlier this month. Colao believes the deal will get the green light from Brussels.
"I don't see problems," he said.
However, he is less enthusiastic about the proposed merger between Hutchison's U.K. business, 3UK, with Telefonica's O2, largely because the two mobile operators are involved in separate network-sharing deals.
"[That] conflicts with competition law," Colao said. "O2 and Hutch cannot pretend to sit on two different, exclusive," network partnerships.