Key Takeaway
Telecom giants are expanding to fund costly 5G rollouts and national fiber expansions, which smaller companies struggle to finance. This consolidation improves operational efficiency and stabilizes revenue streams, easing market pressures. In early 2025, deal volume dropped by 11%, but deal value rose by 20%, reflecting a strategic focus on market-altering transactions. Reduced competition helps stabilize pricing, allowing operators to maintain consistent growth. A Deloitte study indicates that more telecom mergers will be approved in 2025, particularly in the EU, following 13 mergers or joint ventures since 2020 aimed at decreasing customer-facing players in the market.
The Importance of Scale in Telecommunications
The increasing size of these telecom giants enables them to finance 5G rollouts and national fiber expansions—investments that require billions and demand long-term financial stability, which smaller companies often find challenging.
This consolidation helps alleviate market pressures by enhancing operational efficiency and creating more predictable revenue streams.
In the first half of 2025, there has been an 11% decline in deal volume. However, deal value rose by 20%, suggesting a strategic shift towards transactions that reshape market structures.
This reduced competition helps ease pricing pressures, allowing operators to stabilize tariffs and pursue consistent growth.
A Deloitte study states: “More in-market telecom mergers will be approved in 2025 and beyond, initially led by the European Union… Since 2020, there have been 13 telecom mergers or joint ventures that have reduced the number of customer-facing players, either approved or in the approval process by governments and regulators… In April 2024, former Italian PM Enrico Letta submitted a report to the EU, explicitly advocating for telecom consolidation.”
