Already a significant cable broadband access network owner in Europe, Vodafone has struck an €18.4 billion (US$21.8 billion) deal to acquire Liberty Global's cable operations in Germany, the Czech Republic, Hungary and Romania in a move to create one of Europe's biggest integrated fixed/mobile service providers.
The agreement with Liberty Global Inc. (Nasdaq: LBTY), one of Europe's biggest operators of cable networks, is the latest cable broadband M&A move by Vodafone, which has acquired cable assets in Spain (ONO) and Germany (Kabel Deutschland) during the past five years.
It will leave Vodafone Group plc (NYSE: VOD) with around 54 million cable or fiber customers and a next-generation network reach of about 110 million homes and businesses, the operator noted in a presentation to investors and analysts early Wednesday.
The transaction would make Vodafone the chief rival in Germany to incumbent national operator Deutsche Telekom AG (NYSE: DT), which currently markets broadband services to around 30 million homes.
Unitymedia, Liberty's German subsidiary, would be added to the Kabel Deutschland business that Vodafone acquired in a €7.7 billion ($9.1 billion) deal in 2013, allowing Vodafone to market next-generation broadband services to nearly 24 million homes across the key European market.
Vodafone's CEO Vittorio Colao sees value in building an even greater cable broadband empire across Europe.
Under previously announced plans to extend "gigabit" network offerings to around 1 million German homes, Vodafone is pushing for a gigabit coverage target of 25 million homes by 2022. "This represents more than two thirds of the German government's 2020 fiber vision for gigabit connectivity across the country," said Vittorio Colao, Vodafone's CEO, during the presentation.
Consumers are buying millions of IoT devices, from smart thermostats and security systems to intelligent entertainment setups and furniture. Yet many of these devices remain isolated because home users are uncomfortable connecting them to each other – or even their WiFi. After all, their WiFi network was probably designed only to handle a few laptops, a gaming system and a couple of smartphones. Now, demand on the network is surging and even though you're delivering 100 Mbps to 1 Gbps, that doesn't necessarily mean the broadband power is in the right place or reaches every corner of a home.
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