A merger between Widex and Sivantos (makers of Signia), two of the world's six biggest hearing aid companies, will finalize in March following today’s approval by European Union regulators. With combined revenues of more than €1.6 billion ($1.9 billion USD), the merger will create the third largest hearing aid company in the world, behind market leaders Sonova and William Demant.

Now the hearing industry's "Big Six" players, who account for more than 80 percent of global hearing aid sales, will be the "Big Five." Is that good or bad for hearing-aid consumers and the hearing-health professionals who serve them?

Widex and Sivantos Signia Merger

What the Widex-Sivantos merger means to consumers

Normally, when two big players combine in an industry that's already highly concentrated, antitrust regulators are on high alert. Less competition, higher prices, slower innovation, and weaker customer service can result.

But the hearing-aid industry is in the throes of technology-driven economic change. New low-priced competitors are challenging the leaders by taking advantage of constant reductions in the costs of advanced hearing-aid technologies. And in the U.S., the over-the-counter hearing-aid act deregulating hearing aid sales is expected to make it easy for new competitors to enter the market.

The Big Six hearing-aid makers have already responded to increased competition by lowering prices for their entry-level products. At the same time, they have consolidated their leadership in the premium-priced high end of the market with a succession of new, high-tech products. And the profits from those high-end sales are helping them continue their traditional heavy R&D investments in hearing-technology innovations.

By pooling their already-substantial financial resources, Widex and Sivantos should be able to compete more effectively at the entry level on price with affordable, high-quality products. And they will continue to compete with the other leading manufacturers to be first to develop and deliver the latest new products and technologies to high-end customers.

So consumers looking for the latest and greatest premium-priced hearing aids should be able to continue looking forward to a constant stream of innovation from the "Big Five," including Widex/Sivantos. At the same time, they should continue seeing more moderate prices for entry-level custom hearing aids.

What the merger means to hearing-health professionals

The two companies said that "all Widex and Sivantos brands will continue to operate with separate sales forces and organizations." That means for the time being, at least, it should be business as usual for hearing-aid providers who fit their patients with Widex and Sivantos hearing aids.

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Sivantos spun out of the former Siemens hearing-aid business in 2015 with backing from EQT Partners, a private equity firm funded by Sweden's Wallenberg family. EQT is known as a patient investor that has said it's committed to the company's long-term growth. And with its long history of technical innovation, Sivantos has made no secret of its ambition to re-establish itself is one of the world's top hearing-aid manufacturers.

Meanwhile, Widex has been a family-owned company since its inception and is known for its commitment to R&D and constant development of ever-improving premium-level hearing aids. Following intergenerational changes in leadership over the past few years, the merger should help meet Widex's need for an ever stronger financial foundation to continue competing at both the high-end and entry level of the hearing-aid market.

So in the near-to-mid-term at least, hearing-health professionals can expect continuity in their sales, supplier and support relationships. And, given the focus that both companies have always put on R&D and innovation, professionals can look forward to more cutting-edge products and technologies coming from the combined company.

The devil is in the details

As with any huge merger—especially one that won't be complete for another month—there are countless uncertainties. Especially about how it will impact consumers and the professionals who depend on both companies.

For instance, if there's a big push to save money quickly, consolidation of back-office functions could impact the professionals who rely on consistent product and sales support from each company. The devil will be in the details as the merger is finalized.

Perhaps even more important will be how the combined company responds to competition from new market entrants. If Widex/Sivantos and the rest of the “Big Five” are able to compete successfully with new, lower-priced competitors while continuing leading the industry in hearing-technology innovation, everyone will win.