Could 2010 see O2 finally put its extensively documented network problems behind it? Could be...
Following on from news the telco is planning a £500m 1500 site expansion over the next 12 months, O2 has now confirmed it has entered into a formal five year, multi-million pound agreement with British Telecom which will see its 3G reception bolstered by BT's 21st Century Network (21CN). 21CN replaces BT's old Public Switched Telephone network (PSTN) and is Internet protocol (IP) based.
Nigel Purdy, Head of Networks at O2 UK said: “As we move to an all IP world and as data traffic volumes increase, the consolidation of our fixed and mobile core networks is a common sense approach that will help future-proof our business and provide the best possible service for our customers. BT Wholesale continues to impress O2 with its ability to deliver highly complex solutions. It is a trusted partner and we value its experience in managed services.”
“Our industry is witnessing a significant shift from commodity products to value-added managed services and this latest agreement with O2 is yet another example of how BT Wholesale is at the forefront of this industry transformation," added BT Wholesale Markets MD Brian Fitzpatrick. "The trend to outsource network requirements to BT Wholesale continues as operators look to stabilise their operational and investment costs, enabling them to concentrate on their customers.”
Why would BT agree to such a deal when mobile operators in general are largely seen as the biggest threat to its future and O2, in particular, is even planning a landline service? In short because BT is transforming increasingly into a managed network provider (this now provides 40 per cent of its annual revenue) and such deals are what will secure its future. So a) did BT make a mistake in spinning off O2? Without a doubt, but b) this agreement does make a lot of sense as the company looks to evolve.
All of which is a convoluted way of saying: hopefully O2 mobile broadband will suck less this year...