The future of Europe's mobile operator roaming alliances is on shaky ground after the European Commission this week cleared Telefónica's proposed £17.7bn acquisition of O2, under the condition that the Spanish operator exits the FreeMove alliance.

The Commission expressed concern that the merger would result in distortions of competition in the international roaming market.

This is because Telefónica, which forms one part of the FreeMove alliance alongside Telecom Italia Mobile, T-Mobile and Orange, would switch O2 from the Starmap mobile alliance to FreeMove.

As a result, O2 would cease to exchange international roaming traffic with non-FreeMove members, causing significant cost increases for those companies.

The situation would be particularly acute in the UK where all operators, with the exception of Vodafone, would be affiliated with FreeMove.

To alleviate the Commission's concerns Telefónica has agreed to exit FreeMove, thereby weakening the alliance, while it is not yet clear how O2 will be positioned after the merger.

Telefónica is understood to be negotiating permission with the Commission for O2 to be allowed to remain in the Starmap alliance.

But should O2 be forced to exit Starmap, the move would leave a hole in two of the organisation's most significant markets - the UK and Germany - as well as Ireland.