Telefonica Germany has signed an agreement with Vodafone to have access to the cable networks of both Vodafone and Unitymedia in Germany. The deal is a remedy offered by Vodafone to gain competition clearance for its planned takeover of Unitymedia.
The agreement provides long-term access to Vodafone's cable infrastructure in Germany. It remains subject to the planned acquisition of Unitymedia by Vodafone, which is currently under review by the European Commission. In December, the Commission opened an in-depth investigation into the merger, saying it was concerned about the impact on competition in the German broadband and TV markets.
In order to receive approval from the European Commission, Vodafone has submitted a remedy package including the cable wholesale agreement and a commitment to ensure that sufficient capacity is available for OTT TV distribution on its network. Both the cable wholesale agreement and OTT commitment have the goal to increase broadband competition, the operator said.
The European Commission will now test the remedy package in the market and has set a new deadline of 09 July to decide on the merger. Vodafone expects the Commission to take a decision on the transaction by July, with completion of the takeover taking place later that month, the company said in a statement.
Nationwide broadband operator
Through access to the network, Telefonica expands its fixed-network offering nationwide with high-speed internet, including the capability to provide internet-based TV services. It will be able to supply up to 24 million cable households in Germany with its O2 fixed network products. Telefonica commits to achieving a minimum level of customers over the term of the contract.
The agreement is complementary to the existing infrastructure cooperation agreements in the fixed-network area, whereby Telefonica offers DSL broadband services.
