Vodafone and O2 have agreed to a new collaboration intended to enhance their current network sharing agreement.
This partnership aims to accelerate 5G deployment, offering increased coverage and reduced costs.
Strengthening Network Sharing
Vodafone and Telefonica UK, operating as O2, have entered into non-binding heads of terms to fortify their existing network sharing partnership. The focus is on extending the current agreement to incorporate 5G at joint radio network sites. This extension would facilitate quicker 5G deployment, allowing both entities to offer 5G services to a broader customer base at a lower cost.
Customer Benefits
“We believe that these plans will generate significant benefits for our business and our customers as we move into the digital era of connected devices, appliances and systems on a mass scale,” stated Nick Jeffery, CEO of Vodafone.
By utilising their spectrum holdings more effectively, Vodafone and O2 aim to provide the best 5G experience available to UK customers, delivering faster speeds.
Greater Network Autonomy
Additionally, both companies will deploy their own separate radio equipment in around 2,500 sites in larger cities.
This accounts for approximately 15 per cent of sites outside London and will offer greater flexibility in addressing customer needs.
The intention is to upgrade their transmission networks with higher capacity optical fibre cables, which would enhance the features of 5G, such as low latency, while also providing economies of scale and an improved choice of infrastructure partners.
Efficiency and Future Prospects
The companies are exploring options concerning their future transmission operating model. This could lead to synergies in the investment and operation of their end-to-end networks.
VM and O2 also plan to devolve additional activities to their joint venture company, CTIL, which manages passive tower infrastructure.
This move is expected to enhance operational efficiency and create opportunities to add third-party tenants to the towers.
Spectrum Utilisation
Mark Evans, CEO of Telefonica UK, expressed enthusiasm over the plans, highlighting their potential to meet future customer needs.
Evans added that these plans would optimise the use of the spectrum acquired in the last auction.
The collaboration will see both companies leverage their resources more efficiently to deliver advanced 5G services to a wider geographic area.
Monetisation and Future Investments
There is also a consideration for the potential monetisation of CTIL after the new arrangements are finalised.
This would allow for future investments and bolster the sustainability of the network sharing model.
Conclusion
In summary, the Vodafone and O2 partnership marks a significant step towards revolutionising the 5G landscape in the UK. By enhancing network sharing capabilities, deploying advanced infrastructure, and optimising spectrum utilisation, this collaboration promises to deliver substantial benefits to consumers and businesses alike. As the digital era progresses, such partnerships will be crucial in ensuring widespread access to next-generation connectivity.
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