3 And T-Mobile Together On UK 3G Networks

The two mobile companies will work together on 3G but deny a merger is in the pipeline.

3G is widely touted as the future of mobile networks. But government watchdog Ofcom has only demanded that 3G networks reach 80% of the UK population. In a move that will help both the companies involved and consumers, T-Mobile and 3 are combining efforts so that 98% of the population will be covered by 3G by 2009. Given that some analysts estimate that 3G usage is expected to rise by 240% in the next four years, wider coverage could give the networks a big advantage.

More to the point, by redeploying their networks, it will take only one set of masts and infrastructure, according to a report on ZDNet. They’ll be able to take down around 5,000 masts and move others to widen the coverage, splitting operating and capital costs.

Jim Hyde, chief executive of T-Mobile UK, told ZDNet,

“And the cost savings this ought to deliver both companies certainly provides a model that suggests even more competition in terms of what we’ll be able to deliver to the end users in terms of relevancy of products and services and price.”

However, the news has also fueled speculation of a merger between the two companies. Certainly 3 hasn’t been a profitable venture for its owners, Hong Kong’s Hutchison Whampoa, which decided to forego a market listing last year. Both companies deny ant merger is in the works.