Optus, Voda agree to expanded network

Optus and Vodafone Hutchison Australia (VHA) have agreed to expand their joint-venture network agreement, adding an additional 1800 base stations to Vodafone's 3G network and 1000 to Optus' 3G and long-term evolution (LTE) networks.

(Handshake image by Aidan Jones, CC BY-SA 2.0)

In 2004, Optus and Vodafone signed an agreement to share network sites and infrastructure across Australia. This agreement was scaled back to just site sharing in 2008. ZDNet Australia understands that this new agreement reinforces the site sharing, but will also let Vodafone use Optus' backhaul.

Optus today said that the agreement will result in a 20 per cent increase in the number of mobile sites in the Optus network by 2015, while Vodafone will add around 400 existing Optus sites to its own network, plus 500 new joint sites — subject to approval from the Australian Competition and Consumer Commission (ACCC).

Vodafone further planned to incorporate 900 base stations from the decommissioned joint network with 3 Mobile when it stops operations in August.

Optus said that the joint agreement will allow the company to accelerate its roll-out of 3G network improvements and its new 4G network by 12 to 18 months.

"Today's agreement ensures Optus can accelerate its aggressive push to bring customers a leading mobile network for today and tomorrow," Optus consumer Australia CEO Kevin Russell said in a statement.

Vodafone Australia's new CEO Bill Morrow said that the deal puts Vodafone on the path to introduce LTE services.

"The expansion to our coverage is a significant step forward, and is part of our evolution toward higher-performance network speeds that will ultimately lead to our introduction of 4G," he said in a statement. "The key benefit of the expanded network joint venture will be that it increases the depth of coverage to Vodafone customers."

In addition to the joint agreement, Optus will allow Vodafone customers to roam to Optus' network in a number of regional areas, increasing Vodafone's network coverage to 96 per cent of the Australian population.

Deputy chairman of Vodafone Australia's part-owner Hutchison, Barry Roberts-Thomson, said in an address to shareholders today that despite the woes that Vodafone has faced over the past year, following its infamous network troubles that started at the end of 2010, Hutchison will continue to support Vodafone — contrary to rumours that it is looking to get out of the merger agreement that the companies signed for their Australian operations in 2009.

Hutchison reported a loss of $167.7 million for the year ending 31 December 2011, due to the decrease in Vodafone Australia's profitability last year, as a result of the network issues.

To address the problems, Vodafone has embarked on a massive $1 billion upgrade of its 3G network with Chinese network vendor Huawei. Roberts-Thomson said that 1100 3G 850MHz sites have gone live on the Vodafone network since the upgrade, and a total of 1500 are expected to go live by the end of the third quarter of 2012.

Roberts-Thomson said that the upgrade has been completed in Western Australia, the Australian Capital Territory, the Northern Territory and South Australia. The rest of Australia should be completed in the third quarter of 2012.