REG - Vodafone Group Plc - VODAFONE & VMO2 ANNOUNCE NETWORK SHARING AGREEMENT

VodafoneAnnouncement

03/07/2024 07:00

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RNS Number : 8866U  Vodafone Group Plc  03 July 2024

3 July 2024

 VODAFONE AND VIRGIN MEDIA O2 ANNOUNCE

 NEW, LONG-TERM NETWORK SHARING AGREEMENT

·     New network sharing agreement ('the Agreement') significantly extends
the current agreement between Vodafone UK Limited ('Vodafone UK') and VMED O2
UK Limited ('Virgin Media O2') for more than a decade;

·     Subject to the approval of the merger between Vodafone UK and Three
UK ('MergeCo') by the UK's Competition and Markets Authority, the Agreement
provides a stable basis for MergeCo's enlarged network to participate in the
network sharing agreement and Virgin Media O2 will acquire spectrum from the
MergeCo;

·        The Agreement and formation of MergeCo will transform the
experience for tens of millions of customers across the UK and (subject to CMA
approval) will rebalance the mobile market by creating a third scaled network
operator;

·     The Agreement will extend benefits from MergeCo's committed £11
billion network investment plan to customers of Virgin Media O2 and to the
mobile virtual network operators ('MVNO') with whom they have wholesale
partnerships; and

·       The Agreement and formation of MergeCo will significantly enhance
competition in the retail and wholesale mobile markets.

Vodafone UK and Virgin Media O2 have agreed to extend and enhance their
existing mobile network sharing agreement for more than a decade, bolstering
quality mobile coverage across the country and delivering improved services
for customers.

Many elements of the Agreement expand on the existing arrangement between
Vodafone UK and Virgin Media O2 and are independent of the Vodafone UK and
Three UK merger outcome. However, subject to completion of the merger, the
operators have agreed that Virgin Media O2 will acquire spectrum from the
newly created MergeCo, establishing three scaled mobile network operators each
with better alignment of spectrum holding.

Through a combination of MergeCo's commitment to invest £11 billion in its
network over the next decade (subject to CMA approval) and Virgin Media O2's
£2 billion annual investment in its networks and services, the Agreement will
ensure quality mobile connectivity, choice and competition is enhanced. This
will not only benefit the companies' respective customers but also businesses,
which includes MVNOs who make use of networks via wholesale partnerships to
deliver their own mobile services to millions of people across the country.
The Agreement will ensure these virtual operators have access to a choice of
three high-quality, scaled wholesale competitors, further supporting an
already thriving MVNO segment in the UK.

 

 

Ahmed Essam, CEO, European Markets, Vodafone said: "With this agreement and
our merger with Three, we will transform the mobile experience for over 50
million customers in the UK for the long-term, providing significant network
improvements including more choice, better quality and greater coverage across
the country. These benefits extend to both retail and wholesale MVNO
customers. The proposed merger, together with this agreement, will boost
competition by establishing a strong third player in the UK mobile market and
will improve the balance of spectrum holdings, levelling the playing field
between the UK's mobile operators."

Lutz Schüler, CEO of Virgin Media O2 said: "This new agreement with Vodafone
ensures that quality mobile network choice, performance, coverage and
competition is enhanced to the benefit of millions of consumers, businesses
and our mobile operator partners across the country. We are extending and
bolstering elements of our existing network sharing arrangement, while also
ensuring there is a robust, balanced and functional structure in place for the
long-term should Vodafone and Three's proposed merger gain consent. We believe
that this new agreement addresses the issues we have voiced and the CMA
outlined in its initial decision, and will now continue our engagement with
the regulator in this spirit."

The Agreement includes plans for Virgin Media O2 to purchase spectrum at
market value from MergeCo, increasing their current holding. The Agreement
reduces the current imbalances in spectrum holding between the UK's mobile
network operators, which will enhance competition in the mobile market
allowing MergeCo and Virgin Media O2 to provide increased capacity, speeds and
greater coverage for their customers.

- ends -

Notes to Editors

Any reference to MergeCo is subject to CMA approval.

Subject to regulatory approval, the Agreement between Virgin Media O2 and
Vodafone

·        increases the ability of MergeCo and Virgin Media O2 and
virtual operators to compete more effectively, providing customers with more
choice, better quality, and greater network coverage in all parts of the
country;

·        materially enhances Virgin Media O2's network position
through access to more spectrum, reducing the current imbalance in spectrum
holdings across the UK market;

·        enhances both parties' networks across the UK, reinforcing
the commitment to invest in upgrades, both at existing and new sites; and

·        benefits MVNOs through access to a higher capacity network
across a wider grid of sites.

 

 For more information, please contact:
 Investor Relations:  i (https://investors.vodafone.com) nvestors.vodafone.com  ir@vodafone.co.uk (mailto:ir@vodafone.co.uk)  Media Relations:  Vodafone.com/media/contact (https://Vodafone.com/media/contact)  GroupMedia@vodafone.com (mailto:GroupMedia@vodafone.com)
                      (https://investors.vodafone.com)
 Registered Office: Vodafone House, The Connection, Newbury, Berkshire RG14
 2FN, England. Registered in England No. 1833679

 

 

About Vodafone Group

Vodafone is a leading European and African telecoms company. We provide mobile
and fixed services to over 330 million customers in 15 countries (excludes
Italy which is held as a discontinued operation under Vodafone Group), partner
with mobile networks in 45 more and have one of the world's largest IoT
platforms. In Africa, our financial technology businesses serve almost 79
million customers across seven countries - managing more transactions than any
other provider.

Our purpose is to connect for a better future by using technology to improve
lives, businesses and help progress inclusive sustainable societies. We are
committed to reducing our environmental impact to reach net zero emissions by
2040.

For more information, please visit www.vodafone.com
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, follow us on X at @VodafoneGroup or connect with us on LinkedIn at
www.linkedin.com/company/vodafone
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.

About Virgin Media O2

Virgin Media O2 launched on 1 June 2021 following the merger of Virgin Media
and O2 (Telefonica UK)

The company has more than 45 million UK connections across its award-winning
broadband, mobile, TV and home phone services. Its fixed network covers more
than half of the country (17.2m homes serviceable) alongside a mobile network
that covers 99% of the nation's population.

The company is on track to bring 5G to all populated areas by the end 2030,
and has already launched 5G Standalone in 14 UK cities. It is also upgrading
its fixed network to full fibre to the premises with completion in 2028.
Alongside a separate joint venture called nexfibre, which is expanding fibre
to new areas of the country, Virgin Media O2's total fixed footprint will
reach around 80% of the UK once both build and upgrade work is completed.

Through Virgin Media O2 Business, the company plays a leading role supporting
entrepreneurs, enterprises and the public sector with their digital
transformation through a range of connectivity, security, cloud and
tailor-made services. It is also the network of choice for mobile virtual
network operators giffgaff and Sky Mobile, as well as managing a 50:50 joint
venture with Tesco for Tesco Mobile.

The company is committed to using the power of connectivity to drive change
for people and the planet, taking action to close the digital divide and
building an inclusive, resilient, and low carbon economy. The business has set
an ambitious commitment to achieve net zero carbon across its operations,
products and supply chain by the end of 2040.

Virgin Media O2 is a 50:50 joint venture between Liberty Global and
Telefónica SA and is registered in England and Wales. Registration number:
12580944. Griffin House, 161 Hammersmith Road, London, United Kingdom, W6
8BS.

 

 

 

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