Neither company would put a figure on the contract, but they confirmed it ran into the millions and would run for five years.
Virgin Media Business will use its fibre optic network to upgrade Three’s backhaul, including providing better connections between its 15 aggregation sites and raising its network capacity to 300GB, allowing for the extra traffic the introduction of 4G services will bring.
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“In today’s hectic world, people increasingly demand more from their mobile devices,” said George Wareing, sales director at Virgin Media Business.
“Far from just making calls, now we want to do everything from browsing the web to streaming video. Being able to meet these demands and connect people to anything at any time is a challenge for today’s mobile operators.
“Three recognises this challenge and is doing all it can to safeguard future services. Through its network, it can meet customer expectations and deliver a fast and consistent connection.”
Three began rolling out its 4G network in December 2013 – the last of the UK’s major mobile operators to embark on the task – across Birmingham, London, Manchester and Reading. The operator promised early 2014 would see many more locations added, but said it would not charge a premium for the extra speed.
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The company said it hoped to serve 50 cities by the end of 2014 and wants to reach 98% of the population by the end of 2015.
Bryn Jones, chief technical officer at Three, said: “Being able to browse the internet and stream videos instantly, without buffering, has become a minimum requirement for many customers when deciding on their provider.
“With the high-capacity backhaul network from Virgin Media Business, we are ready to welcome even more people to the Three family. Regardless of where they are, now all of our customers will receive the best possible experiences when using 4G.”
Three has also confirmed a passive network-sharing agreement with rival firm EE. The mobile operators have had a partnership since one part of the EE joint venture, T-Mobile, signed a network-sharing deal with Three in 2007, enabling shared infrastructure and customers to roam on to each other’s networks.
This latest agreement will not be on such a grand scale, with no sharing of spectrum or antennae, and will not include investment in addition to the companies' pre-existing 4G budgets.
However, it will enable them to share the costs of backhaul and civil engineering for 4G sites in the most rural 20% of the UK where the return on investment is likely to be much lower.