German mobile operators link up on UMTS

For the first time, two German wireless operators have signed an agreement to cooperate on their Universal Mobile...

For the first time, two German wireless operators have signed an agreement to cooperate on their Universal Mobile Telecommunications System networks, and are in negotiations to add a potential third partner.

E-Plus Mobilfunk - a subsidiary of the Dutch concern Koninklijke KPN - and Group 3G, a joint venture between Spain's Telefónica Móviles and Finland's Sonera - have announced a deal.

The cooperation will go well beyond shared antenna sites, and include other common elements such as the antennae themselves, cables, transmitters, and radio network controllers, the two companies said in a joint statement.

By cooperating, the operators hope to reach the 50% population coverage required by regulators by 2005, while reducing cost. Shared base stations will also help reduce the number of antennae in heavily populated areas.

"We think we're quite far along with the agreement, and have already planned in detail how it will look," said E-Plus spokesman Markus Gehmeyr.

He added that the two companies would be open to a third partner. "We're still talking, but I can't give any concrete details," he said, adding that his company believed a three-way cooperation would be technically feasible, but was unsure whether a four-way one would work.

The deal has been submitted for approval by German telecommunication and antitrust regulators, Gehmeyr said.

"We've received it but haven't examined it yet," said Rudolf Boll, a spokesman for the German telecommunications watchdog agency adding that he could not predict how long the approval process might take. The agency announced in June that it would clarify UMTS licence rules to make way for infrastructure cooperation as long as each operator maintained a separate network.

A second set of companies - Deutsche Telekom's wireless operator T-Mobile International and British Telecommunications subsidiary Viag Interkom - have signed a memorandum of understanding on network sharing but have not yet submitted a formal agreement to regulators, Boll said.

Wireless operators have been lobbying regulators to allow them to share network infrastructure as telecommunication companies face enormous debt burdens due, in part, to the huge sums paid for European UMTS licences.

Gehmeyr said E-Plus and Group 3G expect to save DM1bn (£319m) in initial infrastructure costs, as well as hundreds of millions in operating costs each year.

Further information
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