The federal government ban on Chinese company Huawei means the merger between Vodafone and TPG is needed to create the scale to build a third 5G network with wide enough coverage to compete with Optus and Telstra, says the head of Vodafone Australia, Inaki Berroeta.

He warned a decision by the competition watchdog to block the proposed $15 billion merger, far from improving competition, would risk leaving Australia with two dominant mobile networks in Telstra and Optus, with Vodafone a distant third, and potentially no fourth network at all.