20pc of base stations for axe in JV

The Orange/T-Mobile joint venture is to result in a 20 per cent reduction in network base stations across the country.

Orange currently has 13,000 2G base stations, while T-Mobile has 10,000. The merger, announced on Tuesday, is to see this number reduced to around 14,000 to 16,000.

Both networks have 7,000 3G base stations each. This number is expected to remain the same with a combined rollout of new stations.

The merger is also expected to result in 35 per cent fewer network sites.

The company presentation said the best sites would be retained for improved coverage and quality of service. Some backhaul sharing is also expected to take place.

An Orange spokesperson said: "We can create a more efficient network through saving power which will also add to the cost savings."

Savings are to come from reduced rental expenses, better leverage to negotiate site locations and rental fees and reduced operations and maintenance expenses.

The company presentation said: "Significant synergies are achievable given that partners have compatible spectrum holdings, network architecture, 2G/3G coverage, rollout plans, voice/data traffic profile and requirements for additional spectrum."

Annual opex savings are expected to mount to £145 million from 2014, while annual capex savings are expected to measure £100 million from 2015.

3's network sharing agreement with T-Mobile is expected to continue.