A week in telecoms: Spanish telcos flag fiber ventures

Cellnex signs network sharing deal with Vodafone and Virgin Media O2

Wireless infrastructure provider Cellnex has signed a long-term infrastructure sharing agreement with UK mobile network operators Virgin Media O2 (VMO2) and Vodafone UK, providing them with access to its tower assets and associated services.

In a statement, Cellnex said the new agreement strengthens and grows the existing relationship, “providing certainty for all parties.”

It noted that the deal supports the MNOs’ separate network sharing agreement, which they recently renewed. That agreement also sees Vodafone commit to selling spectrum to VMO2 should its merger with Three UK go ahead.

On the subject of the planned merger, Vodafone Group CEO Margherita Della Valle stepped up her rhetoric to seek approval from the Competition and Markets Authority (CMA), which is undertaking an in-depth investigation of the proposed transaction.

Della Valle told the Guardian that things like artificial intelligence “cannot happen without good networks.”

“All policymakers understand now the importance of having good quality networks. Look at Labour’s manifesto, for example … nationwide 5G by 2030. There is no doubt that a catalyst is needed to get there because it’s not going to be done [by the current market],” she said.

Vodafone and Three have said that the combination of the third and fourth largest players in the market is essential to drive investment and compete against BT/EE and VMO2.

Della Valle warned that if the merger was not approved the operator would be forced to cut investment further, and would not have the scale to invest in 5G across the board.

“At the moment, the UK has been lagging behind. By creating a third scale operator – [from] the two little guys – the merger has the ability to unlock this,” she said.

Vodafone Spain signs two Spanish fiber MoUs

Zegona Communications is not letting the grass grow under its feet now that it has completed the acquisition of Vodafone Spain from Vodafone Group.

Within the space of a few days, Vodafone Spain signed MoUs with its two main rivals, MasOrange and Telefónica, on the potential formation of fiber ventures.

MasOrange and Vodafone announced last week that they plan to form a shared fiber network company that will cover approximately 11.5 million premises in Spain. This week, Telefónica and Vodafone entered into a period of exclusive negotiations to agree the final terms on a new FibreCo that will pass about 3.5 million premises. In both cases, there are plans to bring in a third investor.

The deals reflect how much the Spanish market has changed in recent months, with the creation of MasOrange and the exit of Vodafone Group from the market. Telefónica has also formed a new wholesale and national roaming deal with Digi Spain that will enable the MVNO to fulfil its ambition of becoming the market’s fourth MNO.

It’s likely that other deals will take place over time. As remarked by Telefónica COO Ángel Vilá during an earnings call, “the whole market is reconfiguring” and all players clearly have an objective to “optimize the return on capital employed by avoiding overbuild risk” and optimize network utilization.

DoCoMo promises up to 6.6Gbps 5G SA speeds

Japanese operator NTT DoCoMo has been boasting that it will start offering Japan’s fastest 5G download speeds of up to 6.6Gbps from August, making use of standalone 5G technology.

The operator is using New Radio-Dual Connectivity (NR-DC) across three frequency bands, 3.7GHz, 4.5GHz, and 28GHz, for high-speed transmissions connecting two 5G base stations. The service will initially be available in specific zones within the 5G SA coverage areas in Tokyo and Kanagawa Prefecture, with plans for a gradual expansion.

DoCoMo began offering 5G SA services in December 2021 and from August 2022 it combined one of two sub-6GHz frequencies with the millimeter-wave band to deliver maximum download speeds of 4.9Gbps and upload speeds of 1.1Gbps. With this latest development, both sub-6GHz frequencies will be combined with the millimeter-wave band for even faster transmission speeds, the operator said.

Meanwhile, 5G SA is still spread relatively thinly around the world. According to the Ericsson Mobility Report in June, around 50 service providers have now launched 5G SA, out of 300 providers to offer 5G services.

As noted in the report, 5G SA offers greater flexibility, scalability and support for new services and applications, enabling service providers to dedicate specific network slices for different use cases, as well as offering premium support for time-critical communications.

Nigeria’s 9Mobile is acquired by UK firm

Troubled Nigerian mobile operator 9Mobile (Emerging Markets Telecommunication Services Limited, formerly Etisalat Nigeria) has been much in the news of late after it was acquired by UK-based LH Telecommunication and recently gained a new CEO in the form of Obafemi Banigbe.

According to local reports, the acquisition was approved by Nigerian Communications Commission (NCC) and the Federal Competition and Consumer Protection Commission, and appears to have fended off a potential merger of 9Mobile with larger rival MTN Nigeria.

LH Telecommunication is acquiring 95.5% of 9Mobile’s shares in exchange for fresh capital. The financial terms of the deal were not disclosed.

Techpoint Africa said the latest development follows reports about nine months ago that MTN Nigeria was in discussions with 9Mobile regarding a potential spectrum acquisition. At that time, there was speculation that the deal could lead to MTN acquiring 9Mobile, raising concerns about the potential establishment of a monopoly by MTN, the report said.

According to Connecting Africa, 9Mobile is the smallest operator in Nigeria with around 11.3 million mobile users at the end of June 2024, according to statistics from market research company Omdia. In comparison, MTN Nigeria had over 83 million mobile subscribers, Airtel Nigeria had 64 million, and Glo Mobile Nigeria had 62.5 million at the end of June.

9Mobile is said to have been struggling after the departure of key technical partners and investors. According to Techpoint Africa, it lost 6,443 subscribers in Q1 2024, representing 72% of the total 9,000 porting activities reported by the NCC. During the same period, MTN lost 473 customers, Airtel 950, and Globacom 1,143.

Millicom plans to buy Telefonica’s Coltel stake for €400m

Millicom International Cellular, which operates under the Tigo brand, said it has entered talks with Telefónica to buy the latter’s operations in Colombia for €400 million in a move that would see the Spanish group exit the market.

Millicom said a non-binding MoU has now been signed. The group also plans to offer to purchase La Nación’s and other minority interests in Telefónica Colombia (Coltel) for cash at the same purchase price per share offered to Telefonica.

Additionally, Millicom intends to offer to purchase Empresas Públicas de Medellin’s (EPM) 50% interest in Colombian telco TigoUne for cash at a comparable valuation multiple as the one implied by the Coltel acquisition.

Its goal would then be to merge Coltel and TeleUne to form a new combined entity. According to Millicom, this would “rejuvenate Colombia’s telecom sector by forming a robust telecom entity with the necessary scale and financial capacity to support the significant network and spectrum investments required to achieve Colombia’s ambitious digital inclusion objectives.”

As for Telefónica, it has already divested operations in many markets in Latin America, where returns were lower than capital cost, to focus on Spain, Brazil, Germany, and the UK. In Colombia, it has already formed a fiber joint venture with KKR that saw the investment firm buy 60% of the partnership.

Millicom, meanwhile, was recently the target of a takeover offer by Xavier Niel’s Atlas Luxco vehicle. The group has recommended to its shareholders that they reject the offer.

Also noted…

Q2 results have been out this week, with some robust figures from Telefónica and T-Mobile US to name but two.

Swisscom also reported stable Q2 performance and appointed Walter Renna as designated CEO of Fastweb once the planned acquisition of Vodafone Italy is completed.

Telenor appointed Torbjørn Wist as group CFO.