Vodafone and Orange announced a new mobile and fixed network sharing agreement in Spain.

Orange’s new active mobile network sharing deal with Vodafone will cover cities with population of up to 175,000, and includes 5G sharing, whereas the previous agreement enabled sharing in towns of between 1,000 and 25,000 people.

The new agreement allow active network sharing including both the radio access network and high-speed backhaul in cities with populations of up to 175,000 people. The network sharing deal will be a setback for telecom network makers such as Huawei, Ericsson, ZTE, Nokia and Samsung.

Vodafone and Orange will share 14,800 sites vs. 5,600 shared currently. This indicates that telecom tower companies will also faced the music from Vodafone and Orange, two main mobile operators in Spain.

The new agreement is expected to deliver cumulative Opex and Capex savings to Vodafone of at least €600 million over the next ten years.

Vodafone will be able to offer fibre and convergent services to an additional 1 million households over the Orange FTTH network, expanding Vodafone’s overall NGN footprint in Spain to more than 23 million homes.

Both companies have agreed to explore potential co-investment opportunities to expand their fibre footprint. The companies did not reveal their joint investment plans to enhance the fibre coverage with the purpose of launching 5G network.

Vodafone CEO Nick Read said: “These network sharing deals mean we can provide a better service to customers, help us to address coverage requirements faster and more efficiently.”

Orange has 96.9 percent population coverage in Spain. Orange’s VHBB connectable homes reached 13.8 million in Spain.

Vodafone Spain’s service revenue grew 2.1 percent in 2018 — driven by a higher customer base in both mobile and fixed. Vodafone Spain added 164,000 mobile contract customers, 109,000 fixed broadband households and 51,000 TV households in 2018.

Vodafone One, its integrated fixed, mobile and TV service, reached 2.5 million households in 2018 from 154,000 in 2017. Consumer converged revenues grew 13.7 percent and now represent 59 percent of total consumer revenue.