Last week's rumor of a strategic partnership between Vodafone Group (NYSE:VOD, news, filings) and euNetworks (SIN:H23, news) turned into reality this morning. euNetworks will provide the fiber infrastructure including fiber-to-the-tower powering Vodafone's LTE rollout to the country's top four cities of Frankfurt, Hamburg, Berlin, and Munich. The two also signed an agreement that would see Vodafone leveraging the company's extended network later on.
Vodafone started building out its LTE network in rural areas late last year, then followed up with the metros of Dusseldorf and Krefeld more recently, and is now apparently ready to take the effort to the major cities. They are moving quickly to challenge dte, and of course it makes a lot of sense to use alternative infrastructure when taking on the incumbent. One might also note that Vodafone likely won't be the only operator leveraging the same backhaul in time, as they have a long term network sharing agreement with Telefonica's O2 in Germany.
Fiber-to-the-tower gets less press in Europe, and microwave backhaul seems to win the day most of the time - at least for 2G and 3G networks. But for 4G, the economics are surely shifting in favor of a substantial fiber component. For euNetworks, this is a very important step forward. The company, which recently purchased Lambdanet Germany, has been working overtime to turn its extensive metro footprint there into an engine of growth much as others in the US have in the past few years.