Vodafone and O2 Buddy Up To Cut Costs – Is A Merger In The Works?
Vodafone and Telefónica (O2’s owner), two of the biggest mobile service providers, have come together in a marriage of convenience, pooling their accumulated mobile networks in a maneuver to slash costs.
Today the companies publicized the union that will join network infrastructure in the UK, Germany, Spain and Ireland, and possibly the Czech Republic (discussions are currently taking place). Both companies will continue to manage their own calls separately, but will either share network sites and masts or build new masts and base stations together.
The deal is an attempt to cut back on costs, which most everyone is doing these days. If the venture works according to plan, it is estimated to save hundreds of millions for each company over the next decade. Initially analysts though mobile phones would be relatively immune to the recession but it appears they are not, as none of us are. Eventually and hopefully this saving of money should trickle down and lead to savings for customers.
The impromptu marriage could have been hastened due to Lord Carter’s Digital Britain overhaul, in which O2 and Vodafone could be made to give up some of their 900Mhz spectrum to other companies. Orange have just said they’re happy to rollout 2Mbps broadband across Britain, as long as O2 and Vodafone give them some of their spectrum to use.
The matrimony is not only supposed to be good for our pockets but for the environment as well. The collaborative building of new sites and sharing of current stations will lead to a “significant” reduction in the total number of masts, reducing environmental impact, the companies said. Any opportunity to bolster green cred, eh? Although it is not such good news for employees, as Vodafone is in the motions of freezing the salaries of 10,000 staff members in the UK, under a month after they announced a plan to cut 500 jobs in Britain as part of proposed plans to save £1bn by 2011.
Given O2 and Vodafone’s increasing cosiness, in assets both physical and intangibly wave-based, are we to expect an outright merger sometime soon?
Posted by Trista Orchard in Sci-tech | March 23, 2009 1:52PM |