Telefónica UK (O2 UK) and Vodafone UK plan to add 5G to their current network-sharing agreement, although it appears that the two European giants are planning to go it alone in some cities throughout the U.K.
The operators formed a mast-sharing project called Project Beacon in 2012, and also established a joint venture called Cornerstone Telecommunications Infrastructure (CTIL) to manage the consolidation of more than 18,000 masts into a single grid. However, there have already been signals that a different approach would be taken with 5G because of the sheer pressure that will placed on the networks in future — especially in urban areas.
Kye Prigg, head of networks at Vodafone UK, told journalists in 2018 that 5G could involve sharing in rural areas “and a different way forward in densely populated areas.” At the same time, Prigg said the two operators were already unwinding parts of the network-sharing arrangement in dense urban areas, including in London.
That approach now seems to have been confirmed. Vodafone and O2 said they plan to extend the existing network sharing partnership term and include 5G at joint radio network sites, while looking to “extend greater network autonomy in a number of larger cities by deploying their own separate radio equipment on approximately 2,500 sites, which represents around 15 percent of sites outside London.”
The operators said they believe this approach would enable them to “deploy 5G faster, to offer 5G services to more customers over a wider geographic area, and to do so at a lower cost,” while also giving them greater flexibility to meet the needs of their customers as 5G services are rolled out.
Vodafone UK and O2 UK also indicated that they intend to upgrade their transmission networks with higher capacity optical fiber cables, although without providing details. Vodafone is building its own “full fiber” network in the U.K. as part of an agreement with fiber specialist CityFibre, potentially reaching 5 million homes by 2025.
Furthermore, Vodafone and O2 said they are also exploring options around their future transmission operating model, “which could drive synergies in the investment and operation of their end-to-end networks.” Again, no other details were provided.
It also seems that the move to add 5G will have repercussions for the CTIL joint venture. The operators said they plan to devolve additional activities to CTIL, enabling the joint venture to take “an enhanced role in the operation of the passive infrastructure, in order to improve the efficiency of its operations and pursue opportunities to add further third-party tenants to the towers.”
There were hints that CTIL could even be sold. Vodafone and O2 said they “will explore a potential monetization of CTIL after the new arrangements have been finalized.”