Cable network access for Telefónica Deutschland: Real competition in the German fixed marked at last
The spectrum auction is behind us, and the next landmark decision concerning the future of the German telecommunications market is already upon us: The European Commission is about to decide whether Vodafone should be allowed to purchase large parts of Liberty Global's European cable network. A statement by board member Valentina Daiber. For Germany, this is about the network operator Unitymedia and whether for the first time since the liberalisation wave of the 1990s and early 2000s there should again be a uniform nationwide cable network. The Commission, as well as numerous market participants, including ourselves, took a critical view of this because such a consolidation gave rise to fears that competition in Germany would be significantly impaired.
An attractive alternative to the network of Deutsche Telekom
Only by opening up this consolidated cable network to a strong competitor could this market problem be remedied. In April, this was resolved: after intensive negotiations, Vodafone decided to open its cable network to Telefónica Deutschland if the transaction were to be approved by the EU Commission. This would enable us to offer high-speed broadband Internet services as well as voice telephony, Internet-based TV services and bundled products on this high-performance network. This agreement offers our customers an attractive alternative to Deutsche Telekom's high-speed DSL network, which is currently the sole technological basis for our fixed-network products. We could supply up to 24 million households in Germany with attractive cable-based services from O2. This would mean extremely speedy connections at attractive conditions and a wider choice of offers. The opening of Vodafone's cable network fundamentally changes the structure of the fixed network market. Until now, Telekom was the only address to which providers could turn. It not only creates competition for the first time ever in the wholesale market for fixed-network products.
We have everything we need to stimulate competition
This solution also ensures that network operators have to face infrastructure competition in order to attract wholesale customers. This should have a two-fold positive effect: On the one hand, through increased performance from which customers benefit; on the other hand, through more investment in the underlying infrastructure. The access agreement is good for the German market. Telefónica Deutschland is ideally positioned to boost fixed network competition. We have the financial resources, the expertise and a strong incentive to throw ourselves into the competition for customers' favor. Every other person in Germany uses our network, and we want to meet the growing demand for convergent products. We look forward to the challenge.