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Vodafone & O2 Ink Mast Sharing Deal

Gordon Kelly

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Vodafone & O2 Ink Mast Sharing Deal

The i's are dotted and the t's crossed...

Today Telefonica (O2 in the UK) and Vodafone have gone public to confirm what we learnt at the beginning of the month: they've embarked upon a network mast sharing deal. More impressive however is the scope. The duo will be playing nice together not just in the UK but also Germany, Spain and Ireland while negotiations are ongoing with regards to an agreement in the Czech Republic.

The 'milestone' collaboration should see both 2G and 3G reception increase significantly "in the longer term", reduce the number of unsightly masts from duplication and - notably - generate "cost savings amounting to hundreds of millions of euros for both companies over the next 10 years." ...of which a significant proportion will be passed onto customers - right guys?

"This industry-leading collaboration means that Telefónica and Vodafone will continue to compete strongly against each other in local markets, while giving our customers enhanced mobile coverage in more places, using fewer mast sites," said Telefonica CEO Matthew Key.

"This move will enable us to focus our resources on developing more innovative and market leading services while delivering on our pledge to reduce the environmental impact of our network roll out," added Vodafone Europe CEO Michel Combes.

All this sounds fine and dandy but we'd like a little more information than "in the long term" references. Some of us need better signal NOW...

Link:

Press Release

bigman

March 23, 2009, 7:30 pm

Basically if you can't get a Voda signal now but can get O2 you will probably get a Voda one in two years time when they share masts. If you can't get either then it's unlikely you will then as the consolidation will take long enough without building new sites as well. O2 data customers are the most likely to benefit due to O2's delayed 3g build out getting a huge step up as a result of this announcement.

Grimboyd

March 23, 2009, 8:29 pm

"... of which a significant proportion will be passed onto customers" &#8230. Yeah right!





Maybe I'll hold on to my O2 iPhony after all

Ben

March 23, 2009, 10:40 pm

I'm looking forward to Vodafone improving O2's coverage :)





Fortunately the Orange/T-Mobile/Three partnership should create strong competition between the two physical networks and result in some improved coverage. Maybe someone will have enough balls to make a geographic coverage claim instead of a population coverage claim - that'd really set the cat amongst the pigeons.

Crash Biker

March 23, 2009, 11:39 pm

I've seen some anticipation that this will improve coverage (and with previous similar articles) which surprises me. This is a cost saving exercise, either one mast will be installed where two would have been installed previously or two close masts will be consolidated into one. In either case there is less coverage, not more.





To some extent you could choose your network provider to get the coverage you want, but once this is implemented that option is much reduced. For example, at home I can only get 3G on 3 due to mast location and reach. If they move that equipment to another mast I'm stuffed. Similarly if you currently have a good signal on your network, mast sharing may cost you that. I concede that theoretically they could now choose to add masts to "weak" coverage locations, or double up on one-proider masts currently installed, but credit crunch and all I think that is wishful thinking and this is a cost saving exercise. Hope not to lose coverage rather than expect an improvement.

Gordon394

March 23, 2009, 11:48 pm

@Ben - yes and no.





Yes it does save money but you are assuming O2 and Vodafone have nothing but mast duplication - they certainly don't. Consequently in many areas (particularly rural) it can be a case of either/or but not anymore.

Ben

March 24, 2009, 12:34 am

@Gordon - I think your comment was @Crash Biker, not me.





Where there's duplication it's hard to imagine one set of equipment would simply win out over the other. The networks need the capacity, especially with the limited success of mobile broadband, and they'll understand that they can't simply remove antennae without plunging users into black spots who previously enjoyed good coverage.





It'll take several years but I think the result will be good. It's somewhat sad that this is happening now, though, rather than when 3G came about. Yet all that remains of the 3G rollout is the most expensive part, so perhaps the timing is perfect after all.

Crash Biker

March 24, 2009, 1:22 pm

I do agree that there is not 100% mast duplication, but my suspicion if you look at the country as a whole is that there is 99% duplication (or pehaps overlay of coverage is a better way of looking at it.) I'd be foolish to think there was no possibility of improvement for anyone at the edge of the network, but equally I would be astonished to see a sudden expansion of base station equipment deployment. (I'm assuming just the masts are being shared - presumably the antenna and transmitters will remain provider specific? Network backhaul could be shared I suppose, any info?)





After a decade+ of rapid expansion the local market is now close to saturation and capacity is not a problem (in general), in fact all those 3G cells have been somewhat under-used. Coverage is no longer a key differentiator for the networks, price and handset offerings dominate and the networks are trying to increase (or maintain) average revenue per customer through extra services. This requires some expenditure on infrastructure centrally but not in the network. Investments will only be made in areas that will drive revenue and capacity and coverage is not an issue for this, everywhere else is subject to cost saving exercises which is where these agreements come in.





Again, not saying no-one will benefit, but on a national coverage/capacity plan this will be a reduction, not an expansion.





Incidentally, clicking through to the 13/3 story I note "It is fairly common consensus that the O2 and Vodafone networks have the best signal around the UK". I don't dispute the absolute truth of this at all, but my understanding of 3 is that it is a native 3G network + 2G roaming on O2, the best of both worlds, which I had always assumed gave the best coverage overall (I think it used to be 3 + Orange).





Ah well - I do hope I'm wrong and being unduly cynical and I'll be delighted if things turn out as Gordon/Ben describe. Cheers.



Gavin Hamer

March 24, 2009, 4:40 pm

This is one huge piece of FUD.





"This is purposely not about radio equipment," Derek McManus of O2 told us, "As well as power supplies we'll be sharing air conditioning and making space in each other's cabinets - we've never done that before."


http://www.theregister.co.uk/2...



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