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The Competition and Markets Authority has today published the industry responses to their interim report on the proposed £2bn purchase of full fibre broadband network Netomnia (Substantial Group) by the parents of nexfibre and Virgin Media (O2), which was provisionally blocked last month. Nexfibre argues that the third-party responses reinforce concerns that the CMA’s findings relied on speculative assumptions.
Readers may recall that the CMA’s provisional ruling effectively rejected some of nexfibre’s claims and found that the transaction amounted to a relevant merger situation (RMS), which they said was “expected to result in a substantial lessening of competition (SLC) in the wholesale supply of fixed broadband services.” The CMA’s report was perhaps surprisingly tough and left little room for nexfibre to propose potential remedies.
Nexfibre responded to this by describing the CMA’s view as being “fundamentally flawed” and complaining that its “conclusions rely on counterfactuals that do not reflect the commercial and financial reality of the UK fibre market” (i.e. the main counterfactual being the alternative of a merger between Netomnia and CityFibre).