Vodafone Germany plans to spend €2 billion ($2.4 billion) on extending gigabit services to about 13.7 million German premises in a further sign of growing infrastructure competition in Europe's biggest market.
The operator said it would spend between €1.4 billion ($1.7 billion) and €1.6 billion ($1.9 billion) to connect around 100,000 German businesses in 2,000 business parks to gigabit-speed networks.
Another €200 million ($239 million) will be used to boost connectivity speeds for the 12.6 million German homes in Vodafone's footprint, around 2.5 million of which can now receive speeds of up to 500 Mbit/s on Vodafone's network.
Vodafone Germany also intends to invest between €200 million ($239 million) and €400 million ($478 million) on building gigabit-speed networks in rural areas home to about 1 million people.
The operator believes it can minimize costs and the "drag" on its cash flow by collaborating with various partners on its gigabit rollout, including local municipalities in rural areas and a fiber-to-the-premises (FTTP) specialist called Deutsche Glasfaser in business parks.
Today's news is likely to put further pressure on Deutsche Telekom, which recently began marketing gigabit-speed residential services but remains focused on upgrading last-mile copper connections rather than making heavier investments in FTTP infrastructure. (See DT Rolls Out FTTH Gigabit Service.)
A technology called vectoring, which cuts out the noise interference between lines, can boost connection speeds on copper-based networks to a theoretical maximum of 100 Mbit/s, but that still leaves Deutsche Telekom AG (NYSE: DT) a long way behind Vodafone on headline broadband performance.
In the recent April-to-June quarter, Deutsche Telekom noted another dip in its share of Germany's broadband retail market as cable operators continued to make gains.
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