Telefonica and Vodafone to Share Facilities

Telefonica and Vodafone have formed a program to share mobile network assets across European operations. They are also exploring opportunities to cooperate in related areas such as the provision of transmission services.

This program is expected to generate cost savings of hundreds of millions of euros for both companies over the next 10 years. It is also expected to reduce the environmental impact of both companies due to the consolidation of existing sites and the joint build out of new sites. Both companies will continue to manage their own traffic independently.

The details of the agreement include:

• Germany: Both companies to share existing 2G and 3G sites. Shared masts can also be used for microwave back haul.
• Ireland: Both companies to open all network sites for sharing by the other party. New builds will also be conducted jointly where roll-out plans are aligned.
• Spain: Both companies to extend existing site share agreement from 2007, which includes the shared usage of power, cabinets and mast. To date 2,200 sites are shared under this agreement. During 2009 and 2010 additional sites will be included.
• UK: Both companies to focus on joint build of new sites and consolidation of existing 2G and 3G sites.

Facility sharing will be an important approach to minimizing costs and the environmental impact of wireless networks during the next decade. It will be a key strategy for deploying 4G networks, in particular.

Femto Cell Interest in Spain and China

Telefonica's O2 mobile arm is planning a femto cell trial. It expects its femto cell commercial roll out to start ramping up in 2010.

picoChip Designs demonstrated its Chinese femtocell reference design in China today announced that femto startup Digimoc Telecom Technology (Shanghai) will use its chips and software designs to make femtocells based on the country's homegrown 3G standard, TD-SCDMA. The news is an indication that China Mobile is interested in the low-power home base stations, because it is the only Chinese operator that will deploy TD-SCDMA in the country.

This is the start of an important trend. Femto cells will off load mobile networks and blur the lines between wireless and wireline services. This will have a major effect on how services are offered in 2020.