O2 , Vodafone, and a 4G promise
Did you hear the sound of thundering hooves this morning? If so, that was two giants of the telecoms industry getting it together. Telefonica UK - O2 to you and me - and Vodafone have unveiled a plan to share their network infrastructure, with the promise that this will deliver next-generation 4G services to UK consumers in double-quick time.
A radical restructuring of the mobile market has been underway - and what we're seeing is the final piece in the jigsaw. There's already a network sharing agreement in place between Everything Everywhere (the daftly named combo of Orange and T-Mobile) and Three, with around 18,000 shared masts by the time the whole operation is completed. Now Vodafone and O2 will have between them 18,500 sites, each delivering coverage to both company's customers.
The UK mobile phone industry has been struggling to adapt to a new world where data from smartphones - rather than voice calls - is putting an increasing load on their networks. At the press conference unveiling the alliance, Telefonica UK's Ronan Dunne talked of a data tsunami, which was only going to get bigger, as 50% of UK teenagers now had a smartphone.
That's why the much delayed auction of 4G spectrum - which should offer much greater capacity - is so important for a digital Britain where more and more of our internet use is going to take place over mobile rather than fixed networks. But now, promised Guy Laurence of Vodafone, the two companies would be able to deliver 4G coverage to 98% of the UK population by the end of 2015 - two years earlier than would otherwise have been the case.
But when I mentioned this story on Twitter this morning, the reaction from many O2 and Vodafone customers was immediate - never mind 4G, when are we going to get some reliable 3G or even 2G around here? The two firms insist this is good news for notspots, where customers will, according to Guy Laurence, "go from zero to hero" in the next couple of years. In particular, they are stressing that indoor coverage - lamentable even in some urban areas in my experience - will be vastly improved.
Customers who have been hearing similar promises for many years may be excused for being cynical. But this time it looks as though both Cornerstone, the Telefonica/Vodafone joint venture, and MBNL, Everything Everywhere's alliance with Three, are serious about investing enough to deliver proper coverage.
So what we will be left with is two mobile networks at the wholesale level, with consumers then able to choose between four main suppliers, plus virtual network operators like Tesco and Virgin. Much the same, in fact, as the fixed line industry, where BT and Virgin Media have an effective wholesale duopoly, but there is still plenty of choice at the retail level.
Four telecoms giants now have the task of delivering on the promise of Digital Britain outlined by the last two governments. The culture secretary Jeremy Hunt has pledged that Britain will have the best superfast broadband in Europe by 2015, with mobile playing a vital role in that. Now it's up to the private sector to make it happen.