This week, Deutsche Telekom and France Telecom announced that they plan to merge, forming the largest mobile operator in Britain. Currently, Deutsche Telekom and France Telecom hold the third and fourth highest market shares in Britain behind O2 and Vodafone, but the merger would streamline operations for both Deutsche Telekom and France Telecom, making the new company more efficient and effective.
Should O2 and Vodafone be worried?
The more interesting question from a branding perspective is which brand name, Orange (French Telecom) or T-Mobile (Deutsche Telekom), will live and which will die after the merger. While the tentative plan reported by the New York Times says that both brands will live for 18-months, there is no word on what will happen to them in the future. Or will both brands die off in favor of a new brand that better reflects the new company’s position as market leader with 37% market share (beating O2’s 27% market share and Vodafone’s 25% market share)?
I’m not as well versed in the European mobile market and the top players as I am in the U.S. market and brands where there have been similar mergers and acquisitions. The bottom line is that consumers will choose the mobile operator that provides the best service for a reasonable price. Will consumers get service with the new Deutsche Telekom and France Telecom company anytime and anywhere that consumers pick up my cell phone? And is that reliable service priced reasonably? That’s the most important thing to consumers. If a merged Deutsche Telekom and France Telecom can deliver those benefits to consumers better than the other players in the market, then consumers will follow.
The next question is which brand name, Orange or T-Mobile better communicates the new brand promise of the merged company. This is where the opportunity lies in branding that could help position the new market leader for future success, and this is where a rebranded company could work very well.
What do you think? Any Brits out there want to fill us in on the insider perspective? Leave a comment below and share your thoughts!
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