The merger between mobile phone giants Orange and T-Mobile has been given the go-ahead, allowing the UK's largest mobile phone operator to be created. The enlarged company will also have a significant share of the mobile broadband and home broadband markets.

Orange and T-Mobile are currently the UK's third and fourth largest operators, and the merger will give the firms nearly 30 million customers nationwide, or 37% of the UK market.

The Office of Fair Trading (OFT) withdrew its concerns over the deal, and the European Commission (EC) backed the merger after the operators agreed to a number of concessions.

France Telecom's Orange and Deutsche Telekom's T-Mobile agreed to give up some bandwidth. They have also reached a new agreement with 3, Britain's smallest mobile provider, which has a network sharing deal with T-Mobile. 3 is a key player in the mobile broadband market, offering a very popular range of mobile broadband deals.

The OFT said the new arrangement ensured that 3's ability to compete in the retail market would not be affected by the merger.

Another concern from rival firms was how the new entity would have a significant share of the radio spectrum at the 1800 megahertz range. This is suitable for next-generation wireless broadband technology that will enable faster web surfing on mobile phones via mobile broadband connections.

But the firms have since offered to divest a chunk of their bandwidth.

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