Mobile Operators Establish Joint Network

German Telekom boss, Niek Jan van Damme is working to start collaboration between the major mobile companies before year end. He wants to build super-fast LTE mobile networks.

“There have been some discussions” which may lead to cooperative agreements. The Deutsche Telekom, Vodafone, O2, the Federal Network Agency and the Federal Cartel Office have all been involved in these discussions. Cooperation would be a surprising improvement, given the tough competition between telecom providers.

In the spring, the three mobile operators had bought LTE frequencies worth 3.6 billion euros. The companies are obligated to begin by providing service to sparsely populated regions. There is no point in building multiple networks to cover these regions. Through a partnership in which all companies use one network, the companies could save millions. The Federal Network Agency and the authorities have repeatedly stressed that they are working together on LTE

Telekom-Germany boss Niek Jan van Damme

By 2011, the goal is to make the existing network faster. “We are aiming for top speeds of 42 megabits per second,” said van Damme. Currently, the top speed is 14.4 megabits per second.

A higher pace in the mobile and fixed network is important for telecom companies. More speed allows providing more complex services such as Internet video games in real time over the phone. The increasing volume of data will keep sales high. The same applies to the fixed network. Internet television (IPTV) can be marketed at higher prices than regular internet connections. However, it only runs smoothly on fast connections.

The LTE model of cooperation currently under discussion provides service for regions which need LTE infrastructure development. Those regions that previously have no broadband connection and are not covered by any of the companies will be divided between the providers under the supervision of the Agency and Antitrust Authority. Telekom has already built the first of the 500 LTE sites that are planned for this year.

The Bonn-based company expects a great improvement from the upgrade. “We use additional data which is from ten to 15 percent at higher speed,” said Van Damme on mobile communications. “What I still do not know is how much this will increase revenue.”

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