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Vodafone Australia Signs $1 Billion Deal with TPG Telecom

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Vodafone Hutchison Australia and TPG Telecom have announced two commercial agreements with a combined value of more than AU $1 billion a major Dark Fibre transmission network expansion and the migration of TPG's mobile customer base to the Vodafone network.

Dark Fibre Agreement

Under the first agreement, TPG will provide Dark Fibre and network services to more than 3,000 Vodafone Australia sites over a 15 year term.

In order to provide the services, TPG will extend its current fibre infrastructure by constructing about 4,000km of new fibre to Vodafone cell sites across the country.

Vodafone Chief Executive Officer, Iņaki Berroeta, said that the transmission agreement is a step change for the Vodafone network, delivering lower latency, an exponential increase in capacity and enhanced resilience.

"Dark Fibre is about preparing Vodafone for the future. It is the next step in our network evolution and builds on our multi- billion dollar network investment in recent years to further enhance the customer experience," Mr Berroeta said. "For customers, it will mean a higher-performing, 5G-ready network which will enable exciting future opportunities such as virtual and augmented reality applications.

This agreement extends the existing relationship between the two companies, with TPG having already delivered 900km of fibre for VHA sites between FY11 and FY13.

Construction of the dark fibre network will start immediately with deployment to the majority of the existing Vodafone network to be completed during 2018.

TPG estimates that it will incur incremental capital expenditure of $300-400m over the rollout period, the majority of which will be incurred over the next 3 years.

TPG will provide the dark fibre services for 15 years from the date each site is delivered, with minimum contracted revenue over the term exceeding $900m.

MVNO Agreement

The two companies have also announced one of the industry's largest-ever Mobile Virtual Network Operator (MVNO) arrangements, with TPG to migrate its mobile wholesale customer base to the Vodafone network.

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Tags: vodafone hutchison australia  tpg telecom  Australia