Tuesday, 31 March 2009

Telefónica and Vodafone to share network infrastructure

In a pan-European collaboration, Telefónica and Vodafone have agreed to share network infrastructure in Germany, Spain, Ireland and the UK with detailed discussions going on in the Czech Republic. The companies expect to save hundreds of millions of pounds over the next 10 years through the agreement, which will also have significant environmental savings through consolidation of existing sites and joint build of new sites.

The actions by country are:

* 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.

More details are in the press release here.

This seems like the sort of win-win situation that we will increasingly see over the coming years. The telecoms sector is a great place for such collaboration, since there are enormous potential savings to be made from sharing infrastructure. It does mean, though, that differentiation will increasingly depend on customer services. You need to be sure your CRM and billing systems are as good as your rivals' and that you have some innovative value-added services to offer, since the basic service delivery will be one shade of vanilla.

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