Orange is to hand off control of its fixed-line infrastructure and broadband services to BT in an attempt to increase its UK coverage and improve the quality of its own services.
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Speaking to the
, Orange said it was disappointed by the poor performance of its fixed-line offerings, which rely on local-loop unbundling within BT exchanges.
Orange hopes the deal will arrest a marked decline in its customer base; it is currently the fifth largest provider in the UK and has suffered from a poor consumer perception of its service.
It plans to use the cash saved for marketing and customer service improvements.
Orange's move mirrors a similar deal cut last summer by
, which backed off its network to BT in an attempt to "
reduce ... fixed costs and capital expenditure".
KCOM's relationship with BT is already beginning to pay dividends for the firm, which has seen substantial savings over the past few months and won a major managed network services deal with retail outfit Phones4U off the back of the agreement.
Orange, which officially completed its UK merger with T-Mobile on 1 April, will doubtless be looking to reap similar benefits.