Virgin Media Ireland and Vodafone have agreed a wholesale network access deal that will allow Vodafone to offer its customers fast fixed-line broadband services by piggybacking on Virgin’s full-fibre network.
Virgin is one year into a three-year upgrade of its network to full fibre, at a cost of €200 million. The investment will result in an increase in broadband speeds from 1Gbps (gigabits per second) to 10Gbps for the one million premises passed by Virgin’s network, the company has said.
Virgin has already upgraded more than 150,000 premises, with a target of 240,000 to be reached by the end of this year and more than one million by 2025.
This is the first wholesale deal that Virgin has agreed with a rival telco. Speaking to The Irish Times, Virgin Media Ireland chief executive Tony Hanway said the move would support more competition in the market and suggested other deals could follow.
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“We will continue to compete like mad at retail level [with Vodafone] but our wholesale division will sell capacity on our network to third parties. The first third party to do that is Vodafone. It’s a new departure for us and the thinking is that we’re putting a massive amount of money [into] bringing the network up to full fibre over three years. Our network would never be at 100 per cent utilisation. We would always have spare capacity.
“We can be more profitable by continuing to use the network for our own customers and by bringing in new wholesale customers via third parties. There’s obviously going to be some crossover and cannibalisation [of the customer base] but we accept that. It’s been done in other countries so we’re not breaking completely new ground. Psychologically, it’s a big departure for us but it’s something that we’re looking forward to doing. Ultimately, we’ll bring competition to the market.”
Mr Hanway noted that Eir has offered wholesale services to its rivals for many years, while Siro (a joint venture between ESB and Vodafone) and National Broadband Ireland, will also offer wholesale services.
Latest data for Virgin Media Ireland shows that, at the end of June 2022, it had 385,100 broadband subscribers, making it one of the biggest players in the market.
Vodafone Ireland chief executive Amanda Nelson said the agreement would allow it to “bring the best products and solutions” to its customers here. “Partnerships such as this, demonstrate our continued focus on our significant network investment strategy, as we look to continually upgrade and refresh our capabilities in Ireland,” she said.
