Vodafone offers network access to telecoms rivals
Vodafone has stepped up its battle to gain regulatory approval for its Liberty Global deal by offering rival Telefonica Deutschland access to its enlarged high-speed broadband network.
The world's No 2 mobile operator agreed a year ago to pay €19.6bn for Liberty's cable networks in Germany and central Europe, seeking increased fixed-line heft to better compete with German market leader Deutsche Telekom.
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Seeking to increase competition in the German market and defuse criticism of the deal, Vodafone said that Telefonica Deutschland would be able to offer super-fast services over Vodafone and Liberty's Unitymedia cable networks in Germany if the deal is approved.
The networks will cover 23.7 million households and would help Telefonica Deutschland to move up from its distant third position in fixed-line broadband, behind Deutsche and Vodafone.
Telefonica Deutschland CEO Markus Haas said the agreement would enable it to connect millions of additional households in Germany with high-speed internet.
"By adding fast cable connections, we now have access to an extensive infrastructure portfolio and can offer to even more O2 customers attractive broadband products - including internet-based TV with O2 TV - for better value for money," he said.
Telefonica Deutschland has nearly a quarter of the German mobile market, second to Deutsche and ahead of Vodafone, according to a 2018 estimate by VATM, which represents independent telecom firms. But it has long trailed rivals in the fixed-line broadband market, with just 5.9pc.
US-based Liberty Global, headed by Irish-American John Malone, has extensive international operations, and has already sold its Austrian business and is now seeking to exit Switzerland as well as Germany and central Europe in what would be its biggest ever divestment. It owns Virgin Media in Ireland.
It had 13 million subscriptions and made revenue of €626m in Germany in the first quarter of this year.
CEO Mike Fries said he was confident the deal could be completed this summer. "We have crossed a number of key milestones and the European Commission is currently in the final stages of its review," he said.
Yesterday's announcement was designed to win over regulators in Brussels reviewing the proposed merger with Liberty, before a decision by July 9.