Vodafone and Telefónica have confirmed they will share network infrastructure in the UK, Ireland, Germany, Spain and potentially the Czech Republic.
The agreement is set to save each company “hundreds of millions of pounds” over the next 10 years as a “significant number” of masts will be reduced. It will enable both networks to rollout mobile broadband across a wider coverage area.
It is also expected to improve service quality for customers and reduce the environmental impact of both networks’ rollout activities due to the consolidation of existing sites and building of joint new sites, while both companies will continue to independently manage their own customer traffic.
Network share plans differ slightly across markets.
In the UK, both companies will focus on the joint building of new sites and consolidation of existing 2G and 3G sites.
In Germany, both companies will share existing 2G and 3G sites. In Ireland, all network sites are open for sharing by the other party. New build will also be conducted jointly where roll-out plans are aligned.
In Spain, both companies will extend their existing site share agreement from 2007, which includes the sharing of 2,200 sites to date. Additional sites will be included during 2009 and 2010. Discussions in the Czech Republic are continuing.
Telefónica Europe chief executive Matthew Key said: “In a fast changing business climate, operators need to look at different ways to serve customers both now and in the future. This industry-leading collaboration means that Telefónica and Vodafone will continue to compete strongly against each other in local markets, while giving our customers enhanced mobile coverage in more places, using fewer mast sites. This will also create significant benefits for Telefónica shareholders.
“We are actively exploring additional areas for cooperation and, by reducing our costs in areas of the business that customers don’t see, we can ensure that we invest in areas they truly value.”
Vodafone Europe chief executive Michel Combes added: “Vodafone has led the market in developing effective network sharing business models, and continues to drive the scale and scope of such agreements. This is a further example of Vodafone’s ongoing commitment to deliver the highest levels of service quality for our customers while delivering greater cost efficiencies to the business.
“This move will enable us to focus our resources on developing more innovative and market leading services while delivering on our pledge to reduce the environmental impact of our network roll out.”