Telefonica and Vodafone in Deal to Share European Networks

Telefonica and Vodafone have confirmed rumours and announced a 10-year European deal to share aspects of their radio networks and infrastructure in Germany, Spain, Ireland and the UK. As part of the collaboration, Telefónica and Vodafone are also exploring opportunities to cooperate in related areas such as the provision of transmission services.

The programme is expected to deliver significant business benefits in the process, including the generation of cost savings amounting to hundreds of millions of dollars for both companies over the next 10 years.

Both companies will continue to manage their traffic independently, but will jointly build new sites where opportunities exist

Matthew Key, CEO of Telefónica Europe, commented: "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."

The joint building of new sites and/or consolidation of existing 2G and 3G mast sites, with one site housing the equipment of both companies where previously two would have been used, is expected to lead to a significant reduction in the total number of masts in operation and reduced environmental impact, compared to both companies expanding their networks separately.

Further Detail:

Germany: Both companies to share existing 2G and 3G sites. Shared masts can also be used for microwave backhaul.

Ireland: Both companies to open all network sites for sharing by the other party. New build will also be conducted jointly where roll-out plans are aligned.

Spain: Both companies to extend existing site share agreement from 2007, which includes the shared usage of power, cabinets and mast. To date 2,200 sites are shared under this agreement. During 2009 and 2010 additional sites will be included.

UK: Both companies to focus on joint build of new sites and consolidation of existing 2G and 3G sites.

In the UK and Ireland, the elements of the network to be shared include: masts, antennas, sites, cabinets and power supply. The network electronics Nodes B (3G), BTS (2G) and the radio network controllers which are linked to the core network are to remain independent. In Germany and Spain, masts and cabinets are shared, along with power supply.

Posted to the site on 23rd March 2009