E-Plus and Group3G co-operate in rollout of UMTS network (Detail)

date: September 16, 2001

E-Plus from Dusseldorf and Group3G from Munich, a joint company of Telefonica Moviles and Sonera, will co-operate closely in the rollout of the UMTS network in Germany. The two companies have signed a corresponding agreement, which goes well beyond simply sharing aerial sites. E-Plus and Group3G will also share other elements of the network, such as aerials, cables, transmitters and radio network controllers, which control transmitters.

The partners will each individually develop additional areas for UMTS beyond the network area they have rolled out in partnership and use them jointly. As a result, the population coverage will exceed the 50% demanded by the Regulator by 2005 while overall costs are being reduced. This way the number of aerial sites in densely populated urban areas, for instance, could also be reduced. This is an important factor that promotes acceptance of the new technology among the population.

Compared to the planned investments for the UMTS auction, the network providers have made first savings because the cost of network elements has decreased in the meantime. Improvements in planning, after which the targets for network rollout and quality can be achieved with fewer sites, have led to further savings.

The co-operation will save E-Plus and Group3G a considerable amount of the originally planned investments for the network rollout. There will also be significant potential savings in the annual fixed costs.

The agreement is the first effective UMTS network alliance in Germany. It shows that the companies intend to work together and determines the economic indicators of the co?operation. The agreement also marks the last step towards the actual rollout of the network across Germany because it also lays out the complete implementation right down to organisational details, such as the line-up of the construction teams in each region.

The agreement is open to a third partner. It is an addition to the "National Roaming Agreement" on the use of the E-Plus GSM/GPRS network by Group3G, which the two companies concluded at the end of April.

E-Plus and Group3G base their co-operation on the conditions for UMTS licenses as interpreted by the Regulator for Telecommunication and Postal Services in early June. These state that the UMTS license holders in Germany are permitted to share certain components of the infrastructure during the rollout of the network as long as full independent use of the network and independent competition of the license holders are guaranteed. The Regulator and the Federal Monopolies and Mergers Commission still have to examine the agreement concluded between E-Plus and Group3G. The agreement also still requires the approval of the shareholder committees of E-Plus and Group3G.

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