In a move that promises to transform the telecommunications landscape in Spain, Vodafone Spain and Telefónica have reached a new wholesale fiber optic agreement. This pact, announced on September 12, 2024, marks a significant milestone in Vodafone Spain’s fixed-line strategy.
Details of the agreement
The new contract, which will replace the current one expiring at the end of 2024, is based on a non-binding and confidential term sheet. According to Zegona Communications plc, the owner of Vodafone Spain, this agreement will generate material synergies for both companies by:
- Maximizing the use of existing networks
- Optimizing investments
Additionally, the terms of the new agreement are expected to provide significant economic benefits for Vodafone Spain compared to its current wholesale arrangements.
Strategic context
This agreement follows two “FibreCo” transactions previously announced by Zegona in July 2024:
- An agreement with MasOrange, S.L. to create a fiber network joint venture covering approximately 11.5 million premises in Spain.
- An agreement with Telefónica for a joint FibreCo covering around 3.5 million premises.
Impact on Vodafone Spain’s strategy
The combination of these fiber transactions ensures that Vodafone Spain will have long-term and economically advantageous access to a complete national fiber coverage. This will enable the company to offer the most technically advanced connectivity services to all its customers.
Management statements
Eamonn O’Hare, Chairman and CEO of Zegona, commented on the agreement:
“This new fiber wholesale agreement with Telefónica perfectly complements our recently announced FibreCo transactions and completes the transformation of Vodafone Spain’s fixed-line strategy. The powerful combination of these agreements will provide national fiber coverage without additional investment in the network. Vodafone Spain will be able to leverage these advanced network assets to offer cutting-edge fiber solutions to all its customers. We expect these agreements to generate substantial economic benefits for Vodafone Spain and significant incremental value for all Zegona stakeholders.”
Future outlook
With this agreement, Vodafone Spain strategically positions itself in the Spanish telecommunications market, ensuring a robust network infrastructure without the need for significant additional investments. This move could have significant implications for competition in the sector and for the quality of services offered to Spanish consumers in the years to come.