Mobile phone operators O2 UK (Telefonica) and Vodafone have today officially entered into a new Network Sharing agreement that will help them to “deliver the capability for a nationwide” deployment of “4G” superfast Mobile Broadband services and close the Digital Divide between rural and urban areas by targeting 98% indoor population coverage across 2G / 3G by 2015.
The plan, which would involve the creation of a new 50/50 joint venture company, envisages a single “national grid” network of 18,500 sites across the UK with both operators continuing to run independent spectrum and competing services.
Apparently this approach would allow both to deliver nationwide “4G” services “faster than could be achieved independently” and up to two years before the anticipated regulatory requirement of 98% population coverage by 2017. All shared sites will continue to carry O2 UK traffic on O2’s spectrum and Vodafone UK traffic on Vodafone’s spectrum.
Ronan Dunne, CEO of Telefónica / O2 UK, said:
“Exceptional customer demand for the mobile internet has challenged the mobile industry to consider innovative solutions to building a nationwide network that will be fit for our customers in the future and support the products and services that will truly make Britain digital. This partnership is about working smarter as an industry, so that we can focus on what really matters to our customers – delivering a superfast network up to two years faster than Ofcom envisages and to as many people as possible. One physical grid, running independent networks, will mean greater efficiency, fewer site builds, broader coverage and, crucially, investment in innovation and better competition for the customer.”
Guy Laurence, CEO of Vodafone UK, said:
“This partnership will close the digital divide for millions of people across the country and power the next phase of the smartphone revolution. It will create two stronger players who will compete with each other and with other operators to bring the benefits of mobile internet services to consumers and businesses across the country. We have learned a lot from our existing network collaboration but now it is time for it to evolve. This partnership will improve the service that customers receive today and give Britain the 4G networks that it will need tomorrow.”
The plan is naturally still subject to Ofcom’s approval, although both O2 and Vodafone hope to establish the joint venture and network sharing arrangement “later this year“. Rival mobile operators Three UK, Orange UK and T-Mobile also have a similar joint venture established under the MobileBroadband Network Limited (MBNL) name.
In addition the move could make Ofcom’s life a little more complicated as it would have to reconsider its assessment of the market and any knock-on impact for the forthcoming (Q4-2012) auction of 4G spectrum (800MHz and 2.6GHz). Both Vodafone and O2 UK are unhappy that Three UK could be gifted a slice of 800MHz spectrum and that Everything Everywhere (Orange UK and T-Mobile) could launch 4G in 2012 if allowed to repurpose the 1800MHz band.