Two of the UK’s largest mobile operators are to join forces, sharing their 2G, 3G and 4G mobile broadband networks. A new company will be formed in which both O2 and Vodafone will have equal shares. This will take control of all 18,500 sites across the UK.
Ronan Dunne, Chief Executive of Telefónica – parent company of O2 – said the new partnership is about “working smarter as an industry”. He went on to say, “One physical grid, running independent networks, will mean broader coverage and, crucially, investment in innovation and better competition for the customer.”
With a comment which may have been a nod towards the friction that’s currently surrounding EE’s current 4G exclusivity, he also added, “We look forward to Ofcom’s spectrum auction and the release of 800MHz spectrum.”
Chief Executive of Vodafone UK, Guy Laurence, said that this is “excellent news” for British consumers, businesses and the wider economy. “We are promising indoor coverage for 98 per cent of the UK population across all technologies within three years. We will bring the best mobile coverage that this country has ever enjoyed to more people than ever before.”
Don’t expect to be waking up to fantastic new services tomorrow though, by the time this has all come to fruition we’ll be looking at 2015 on the calendar app running on our holographic, mind controlled, supercomputer-phones.
Source: uswitch
Story history: Vodafone and O2 merger
So is this gonna be like a BT openworld type scenario? Voda and O2 still run their own mobile business. The new company will then be providing the infrastructure for them to do it? How much are they gonna share? Base stations? Or the whole thing? Wonder what the OFT will make of this? Prices *should* come down as their individual investments will comes down. Bet they don’t though!
It’s exactly what 3UK and T-Mobile did. One network two operators sharing the hardware, tough technically for a while it became three when Orange joined the party. OFT will make nothing of it as they will continue as separate trading companies with different marketing strategies and probably pricing too. Prices will not come down as they will have to spend billions on all the new hardware, lease agreements, termination fees with landlords and then keep trying to recoup the billions spent on the fiasco that was the 3g licence auction and soon the 4g circus.
The key for the normal consumer is pricing for LTE services. Unless these new organisations can reduce cost why do I want to pay £50-£100 per month for a limited LTE allowance (that will run out sooner rather than later)? Alos, while these organisations are not in a monopoly position they are getting close to it – would you be allowed to do this in another industry without government scrutiny?