Vodafone and Orange abandon joint venture

FOLLOWING THE leak of a new deal between UK operators, Vodafone and Orange, the pair have finally admitted that their proposed joint venture is dead.

It's believed that France Telecom, Orange's parent, got cold feet about shoving the assets involved in operating its network into a shared venture. So instead, the two operators have struck a much simpler deal – they'll just share the same physical cell sites.
Even this is expected to result in the need for 15 per cent fewer sites, which over two years will mean 3,000 less sites. Given the public's attitude towards cellular masts, that's something of a PR coup.

The new deal is rumoured to have been pushed through by the new head of Orange UK, Tom Alexander, who was previously head of Virgin Mobile. Come to think of it, he was once head of Virgin Games, too.

Although the announcement was very watered down from the original objectives, there was still some hint that the running of physical network might still be outsourced.

A memo sent round to Vodafone's engineers – after the news had already been leaked – by Vodafone

UK CEO, Nick Read, still says, "We remain committed to exploring the outsourcing of our field operations and maintenance teams."
The INQ isn't sure whether this would let Ericsson – which already runs the network for 3 UK – to pitch for the business.

What it does mean is that O2 is looking increasingly isolated, given that T-Mobile and 3 have come to a more far-reaching agreement on the network sharing front.

Ironically, it is O2 which has been slowest in rolling out its 3G network and would have most benefitted from coming to a deal with the likes of 3 or Vodafone. µ

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