Vodafone picks Ericsson, Nokia for £2 billion network buildout

(Bloomberg) — VodafoneThree picked Ericsson AB and Nokia Oyj for a £2 billion ($2.7 billion) contract to expand the newly formed mobile operator’s network across the UK.

Ericsson won slightly more of the contract, with the Swedish vendor chosen to deploy its radio access network across 10,000 sites and upgrade its core network, VodafoneThree said in a statement on Monday. Nokia will supply its RAN technology to 7,000 sites.

The £2 billion, eight-year contract provides the two Nordic makers of 5G equipment a much-needed sale in a sluggish mobile market. Operators, especially in Europe, have delayed expensive upgrades in recent years.

VodafoneThree pledged to invest £11 billion in network infrastructure when the mobile carrier was created in a joint venture between Vodafone Group Plc’s UK unit and CK Hutchison Holdings Ltd.’s Three, approved by regulators in December. The new entity, majority-owned by Vodafone Group, has become Britain’s largest mobile carrier with about 28.8 million customers.

The deal is a blow to Samsung Networks, which has struggled to gain major market share in the network equipment business even though operators want to keep rivals to Nokia and Ericsson alive. Vodafone Group has been a particular supporter of the Korean vendor and its efforts to develop so-called OpenRAN, which allows operators to mix and match parts from different vendors.

Vodafone Group has a larger tender out for its whole network across Europe and emphasized that Samsung will be a member of that larger European rollout.

“Vodafone has selected a number of strategic partners, including Samsung, Ericsson, and Nokia, to jointly deliver a future-ready network infrastructure covering 15 countries across Europe and Africa,” a representative for Vodafone Group wrote in a statement. This includes both OpenRAN “at scale” in Europe.

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