Telecom Operators

Vodafone closing its paging business after watchdog threatens investigation

Vodafone and London-based Capita, an international business process outsourcing and professional services company, run the UK’s last two paging businesses. Vodafone was set to sell its paging business to Capita. However, the Competition and Markets Authority (CMA) expressed concern that the sale could mean customers face price increases. Therefore, Vodafone halted the sale and is closing the paging business.

The CMA’s decision resulted in disappointment for Vodafone – the company said it made more economic sense to close the business. A Vodafone spokesperson said, “This seems to be a surprising decision considering that this market has been contracting for some time and no other country in Europe has more than one wide area paging network.”

The spokesperson added, “Due to the expense involved with a prolonged investigation, Vodafone will not pursue the transaction and has made the decision to close down this business, which is based on ageing, standalone technology no longer supported by network vendors.” Vodafone, the spokesperson said, will do “its utmost to minimize the impact on the 1,000 or so customers still using the service.”

It hasn’t been confirmed yet whether or not Vodafone’s remaining paging customers will end up transferring to Capita’s PageOne business. A spokesperson said, “We are disappointed that the acquisition has not been approved at phase one by the Competition and Markets Authority.”

Pager technology has declined in popularity over the years. However, pagers are still used by people such as those in the emergency services industry because of the technology’s reliability, coverage and long battery life. Armies still use pagers, as well as the NHS and lifeboat services. Pagers were popular in the 1990s and often referenced in hip-hop songs, like Jay-Z’s single “I Just Wanna Love U (Give It 2 Me)”.

In the UK, Vodafone and Capita are the only suppliers of wide-area paging services. The CMA claimed that acquiring Vodafone’s paging business could lead to higher prices as well as reduced quality of coverage for customers using the technology.

The CMA said in a statement Vodafone and Capita would need to “find acceptable ways of addressing competition concerns” to avoid an investigation. The regulator added, “Capita and Vodafone both supply wide-area paging services to customers, including emergency services and hospitals.”