The same day Vodafone (News - Alert) chief executive, Vittorio Colao, challenged the European Union and threatened to cut new network investments, the European mobile company has offered an alternative, compromising solution to the region’s cellular problems.
The company has offered to join forces with rival firms to share the 30 billion euro that it would cost to build a new superfast fiber network across Europe. As a sign of the increasing amount of demands being placed on network operators, Colao is approaching rivals in Germany, Spain, and Italy to consider co-investing a new network, that won’t cost European consumers more money in a time of financial strain.
“So far, we have not succeeded in convincing them that this is a good idea but we are keen on doing it,” Colao said at the Mobile World Congress (News - Alert) in Barcelona on Monday. “If times are tough and there is not enough money, we should probably go into a co-investment situation and have open co-invested infrastructure.”
The key to the problem for most European mobile companies is the continued reduction in mobile termination rates and fees operators charge each other to connect calls. Fees for making calls while abroad have also decreased, all while operators are having to spend more to meet consumer demands for fast networks to be able to stream video and games on smartphones, laptops or tablets.
Although initially many of Europe’s largest operators scoffed at the idea of sharing the build-out of a fix network, it may be hard for them to ignore the benefits of a shared expenses network. As network availability for high-speed connections across Europe become more cluttered, and regulating prices are making it harder for providers to business competitively, this clear solution could benefit all parties involved.
That being said, SpiderCloud and Vodafone announced a partnership on Monday to offer 3G cellular networks to enterprises in the United Kingdom. SpiderCloud’s enterprise-based 3G network enable mobile operators to offer enhanced cell coverage, and additional network capacity for businesses inside buildings.
As businesses continue to increase high-speed broadband use to connect with employees, this is a great example of a valid solution to the overarching problem that other providers will have to consider.
Even if a partnership like the one Vodafone proposed does not happen throughout Europe, coexistence is the only way these networks will survive. With a flailing industry that does not offer many options for payment restructure, European networks must find a way to coexist if they wish to survive.
Most likely smaller partnerships like SpiderCloud and Vodafone’s will increase, forcing some of those hesitant providers to rethink their stance on co-investing in a high-speed broadband networks that would transform the entire continent’s mobile services.
Edited by Jennifer Russell