Vodafone 海角视频 has received a significant £343m boost from Virgin Media O2, following the recent approval of its substantial merger with Three.
Virgin Media O2 has agreed to purchase a portion of mobile spectrum from Vodafone 海角视频 for £343m, a move anticipated to bolster its network capacity amidst growing concerns over mobile connectivity, particularly in London, as reported by .
Mobile spectrum refers to specific radio frequencies within the electromagnetic spectrum utilised for wireless communication by mobile phones and other devices.
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This limited resource enables devices to connect to cell towers and access services such as voice calls and internet data.
If Ofcom approves the transfer – 78.8MHz of spectrum – it would result in Virgin Media O2 controlling approximately 30 per cent of the 海角视频's total mobile spectrum, aligning it more closely with VodafoneThree and BT's EE.
Company executives believe this deal will enhance network performance for both retail and wholesale users.
However, this comes against a backdrop of deeper structural issues in the 海角视频's telecoms market, where inconsistent rollout and legal disputes over land access have left the country – especially London – trailing its European counterparts in terms of 5G.
The newly acquired spectrum will be gradually deployed over the medium term, with a portion of the cost covered through Virgin Media O2's recent minority stake sale in infrastructure joint venture Cornerstone.
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This deal is a component of a broader mobile network sharing agreement inked with Vodafone last year.
Under this agreement, the newly amalgamated VodafoneThree will engage in shared infrastructure use with Virgin Media O2 for at least the next ten years.
London stuck in the slow lane
This development arises as data indicates an escalating digital divide.
London now holds the dubious distinction of being the poorest-performing European capital in terms of 5G availability and quality, as per recent statistics.
Coverage gaps are becoming increasingly noticeable, even as operators gear up to phase out older 3G networks – Virgin Media O2's switch-off is slated for the end of 2025.
A significant part of the issue can be traced back to the 'electronics communications code' reforms in 2017, which slashed site rents by up to 90 per cent and eliminated landowners' capacity to negotiate commercial terms.
The aim was to expedite the rollout by cutting costs – but in reality, it has sparked a surge in litigation and put a halt to new infrastructure developments.
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Over 1,000 disputes have made their way to the property tribunal system since the rule alteration, compared to a mere 33 in the three decades before.
Hospitals, schools, councils and other public entities have been embroiled in court disputes with operators over forced rent reductions and site access.
A market under pressure
Virgin Media O2's spectrum purchase adds pressure to the market, supplementing the £2bn it claims to be already investing in its mobile network.
However, competition has intensified. VodafoneThree, now catering to over 27 million users, has committed to £11bn in network enhancements over the next ten years, including a hefty £1.3bn in capital expenditure this year alone.
According to Ofcom's benchmarks, BT's EE still holds the top spot for rural coverage and network performance.
The Competition and Markets Authority (CMA) gave the green light to the VodafoneThree merger after securing a series of commitments, including tariff protections and investment pledges.
Despite this, some consumer advocates and unions have voiced concerns that the reduced number of competitors could ultimately lead to less choice and weaker competition in the long run.