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Mobile operator O2 (Virgin Media) has today revealed the details of their spectrum transfer agreement with Vodafone UK (VodafoneThree), which follows last year’s network sharing deal. This will see VMO2 acquiring 78.8MHz of spectrum for an investment of £343m to “materially enhance” their 4G and 5G mobile (mobile broadband) network.
In case anybody has forgotten, VMO2 and Vodafone signed a key 10-year network sharing agreement back in July 2024 (here), which was necessary in order to correct for some competitive conflicts that might have been created by Vodafone’s recently completed merger with Three UK (i.e. Three had a network sharing agreement with EE, while Vodafone had one with O2).
The deal also stipulated that – upon completion of Vodafone’s merger with Three UK – VMO2 would later acquire spectrum from the newly created VodafoneThree, thus establishing three scaled mobile network operators each with better alignment of their respective spectrum holdings. But the exact details and value of that spectrum deal has, until now, remained unclear.
The spectrum will be partially funded by the minority stake sale in Cornerstone in 2024, with spectrum payments extending beyond 2025 and “deployment occurring over the medium term, starting this year“.
Spectrum Being Acquired by VMO2 from Vodafone UK
• 20MHz of 1400MHz Supplemental Downlink
• 18.8MHz of 2100MHz Frequency Division Duplex
• 20MHz of 2600MHz Time Division Duplex
• 20MHz of 3400MHz Time Division Duplex
Lutz Schüler, CEO of VMO2, said:
“This acquisition of spectrum will not only create greater balance in holdings across the UK’s mobile networks, but for Virgin Media O2 it will allow us to boost coverage and further improve our network quality, building on the significant investment we are already making in our mobile network. We’re committed to giving our customers a reliable mobile experience across the country and this increase in spectrum will help us deliver on that.”
The news bodes well for O2, which in many independent studies has tended to show somewhat of a performance detriment (particularly with respect to data speeds) when compared with Vodafone, Three UK and EE – this is despite the operator now having much greater access to Virgin Media’s national fixed line network.
The extra spectrum should help to boost their network performance and perhaps also improve signal coverage in some locations, which will no doubt be welcomed by the operator’s customers and MVNO partners. But we would have liked a bit more detail on the exact timescale for each band to be deployed (we’ve asked VMO2 and will report back if they provide more info.).