Orange and TMo merge networks in Poland
In the latest cost reduction deal between French and German telcos, Polish venture emulates Everything Everywhere in the UK
Published: 22 July, 2011
European giants Deutsche Telekom and France Telecom are getting ever closer as they pool resources to cut their costs. They signed a far-reaching joint procurement alliance in April, have a machine-to-machine collaboration, and are engaged in several network sharing plans. The latest is in Poland, where the firms' T-Mobile and Orange mobile arms have formed a joint venture on the same lines as their UK firm, Everything Everywhere.
The two Polish units - Polska Telefonia Cyfrowa (TMo Poland) and Orange Poland - have adopted a similarly odd brand name to that of their UK counterparts, in their eagerness to avoid giving undue prominence to either of their well established brandings. They have merged their operations into a 50:50 venture called NetWorkS!, which will manage and develop networks for both partners.
Orange Poland's CEO Miroslav Rakowski said that increased efficiency in investment would allow network expansion to be accelerated, with a particular focus on improving coverage, including indoors. The combined resources will also speed the introduction of new services based on mobile broadband, the companies said.
The combined network will consist of 10,000 base stations once about 3,400 redundant locations have been axed. Currently, TMo owns 7,000 base stations and Orange 6,400. The rationalization will be carried out first, and then there will be gradual network expansion from late 2011 until 2014, at which point the pace will pick up, according to company officials.
They also said that the deal will reduce their capex and opex spending by about 29% in the first three years. Then, Orange expects to make annual savings of around PLN200m ($71.5m) from 2015 onwards.
Orange Poland is 100% owned by Polish incumbent telco, Telekomunikacja Polska (TP), itself controlled by France Telecom, which owns just under 50% of the group. T-Mobile Poland is fully owned by Deutsche Telekom.
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