Europe’s leading telecommunications companies — including Deutsche Telekom, Orange, Telefonica, TIM, Vodafone, Nokia, and Ericsson — have urged the European Commission to ease the bloc’s strict merger and antitrust rules. The telecom giants argue that such reforms are vital to drive investment in digital infrastructure and to help European players compete with rivals from the U.S. and Asia.
The appeal comes ahead of the Digital Networks Act (DNA), a legislative proposal the European Commission plans to unveil in November 2025. The Act aims to accelerate digital infrastructure development and promote cross-border connectivity across Europe. However, it has already encountered hurdles after an internal Commission body issued a negative opinion on the draft legislation last week.
In a joint letter addressed to European Commission President Ursula von der Leyen, the CEOs described the DNA as a crucial opportunity to strengthen Europe’s telecom ecosystem. They warned that without bold action to encourage consolidation and investment, European operators would continue to lag behind their U.S. and Asian counterparts in deploying 5G, fiber networks, and next-generation digital infrastructure.
“Unless the Commission takes bold action with a clearly stated intent to address the need for scale, European industries will continue to lack the strength to invest at the same pace as competitors in the United States, Asia and other markets,” the CEOs wrote.
The telecom industry has long pushed for regulatory flexibility that allows large-scale mergers — including those that reduce the number of operators in a market from four to three. EU antitrust regulators have historically blocked such deals, citing consumer harm and potential price increases.
The joint letter, co-signed by the CEOs of BT Group, CK Hutchison Group Telecom, KPN, Liberty Global, FiberCop, Swisscom, and Telenor, emphasized that Europe’s fragmented telecom landscape limits the ability to invest in emerging technologies and digital services.
Industry Context
Europe’s telecom operators have faced rising costs for 5G rollout, fiber expansion, and network modernization, while revenue growth has stagnated due to heavy competition and strict EU market rules. In contrast, U.S. and Asian telecom markets have benefited from greater consolidation and higher investment rates, giving them a competitive edge in global digital infrastructure.
GSMA says mobile operators in the region are forecast to spend over €198 billion by 2030 on network upgrades to meet growing data traffic.
In the Mobile Economy Europe 2025 report, GSMA estimates that mobile technologies and services generate around 5 percent of GDP (~€1.1 trillion) in 2023. In its Mobile Economy Europe 2023 report, GSMA estimated that the mobile ecosystem in Europe added €910 billion of economic value in 2022, amounting to around 4.3 percent of GDP.
GSMA projects that around 80 percent of mobile connections in Europe will be 5G, with only ~18 percent remaining on 4G by 2030.
At end-2024, 5G already accounted for ~30 percent of mobile connections in Europe (~200 million), above the global average of ~24 percent.
Despite progress, Europe continues to lag behind regions like North America and East Asia in 5G rollout and advanced network deployment.
GSMA forecasts mobile data traffic will almost triple in Europe over the next 5 years, putting additional pressure on network investment.
GSMA argues that scale and investment incentives are important: fragmented markets with many small operators may struggle to generate sufficient return to justify large infrastructure investment. GSMA repeatedly calls for regulatory reform in Europe to unlock investment: easing burdens, clarifying policy, enabling infrastructure deployment at scale.
M&A deals
Swisscom announced the acquisition of Vodafone Italia for about €8 billion as part of Vodafone Group’s strategy to exit markets where returns were below cost of capital.
Orange and MasMovil announced their ~€6 billion merger in Spain combining two major Spanish players to create a larger footprint for broadband + mobile.
e& (UAE) announced the acquisition of assets of PPF Telecom Group across Bulgaria, Hungary, Serbia, Slovakia (~€2.3 billion) — showing a non-European investor buying telecom assets in Europe.
Cellnex Telecom has sold its Austrian tower business for €803 million as part of portfolio rationalisation.
M&A activity in the tower/infrastructure segment in Europe has slowed down; for example, only three tower-deals announced in first nine months of 2025 in Europe, according to S&P Global report.
Outlook
The Digital Networks Act could mark a turning point for the European telecom sector if it addresses long-standing industry concerns around market fragmentation and regulatory burdens. However, without Commission support for consolidation and scale, operators warn Europe risks falling further behind in the race for digital transformation and global competitiveness.
Baburajan Kizhakedath