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3G/HSPA

3 & T-Mobile Share 3G in the UK

As expected, U.K. 3G operator Three UK has inked an HSPDA network sharing deal with T-Mobile (UK) . (See T-Mobile to Bid for 3?)

The operators have set up a joint venture, called Mobile Broadband Network Ltd., to manage the shared networks. The pair are working toward near complete 3G coverage of the U.K. in 2008. HSDPA (High-Speed Downlink Packet Access) is a 3G evolution of the GSM that typically offers wireless data transfers at up to a couple of megabits a second.

The firms say that they will save up to $4 billion over 10 years. Although masts and the 3G access networks are being combined, each company's core network and T-Mobile's 2G network will not be shared.

Analysts at Ovum Ltd. say that the deal could also have environmental as well as cost benefits. And Ericsson AB (Nasdaq: ERIC) is expected to gain on the infrastructure side.

"A beneficiary of this deal is Ericsson, which manages 3 UK's network and some of T-Mobile's network functions," writes Ovum's Martin Taylor. "It will continue in those roles for the new venture, but will be required to produce greater efficiencies for having a combined network. Contracts for future expansions and services will be handled by the venture.”

Orange UK and Vodafone UK have already inked a 3G sharing deal. (See Vodafone & Orange Share 3G.)

Taylor says that this means that Telefónica UK Ltd. is the only major U.K. operator with a RAN sharing deal in place:

"One question mark exists for O2, the only one of the UK operators now not in a network sharing deal. T-Mobile and 3 UK have said that there could be further savings and benefits if a 3rd partner joined the venture and that, after a set-up period, the door will be open for discussions.”

O2 has made no official comment on the prospects of such a deal.

— Dan Jones, Site Editor, Unstrung

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