Vodafone is negotiating a wholesale VDSL2 service arrangement with Deutsche Telekom (DTE.DE) to deliver a new TVG service over the German incumbent's copper-based last mile network.
Citing a person familiar with the situation, Reuters reports that the mobile-centric Vodafone needs to find a way to allay investor and analyst concerns that it can offer its own quad-play offering of wireless, wireline voice, broadband and TV to battle cable operators. It does offer wireline-based services in some of its markets through arrangements with other incumbent wireline service providers.
Given its lack of wireline assets, some of Vodafone's investors were concerned that the pressure to keep up with cable operators would drive UK-based provider to purchase a mix of cable operators such as Kabel Deutschland or other regional telcos.
However, it appears that Vodafone is content to take a partnership approach to build out its wireline broadband business. In addition to conducting wholesale talks with DT, the service provider is jointly building a fiber to the home (FTTH) network with France Telecom covering 50 of Spain's major cities.
Vodafone and Deutsche Telekom, according to Reuters' unnamed source, began laying out the terms of a wholesale VDSL2 arrangement in December. However, neither Vodafone nor Deutsche Telekom responded to the publication's request for comment.
Vodafone's timing to strike a VDSL2 wholesale deal couldn't be better. Deutsche Telekom itself is ramping up its VDSL2 and vectoring efforts to more effectively battle its cable competitors with higher speed data services.
In February, the telco said it would spend €6 billion ($7.9 billion) to build out a FTTC network to deliver up to 50 to 100 Mbps on its existing copper network.
- Reuters has this article
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