European mobile firms join forces to battle Vodafone

30 Mar 2004

Four of the biggest mobile phone network operators have forged an alliance reminiscent of those used by the airline industry with a view to establishing a seamless service that can compete with the growing consolidation being effected by Vodafone across its global network base.

In a move similar to that of the OneWorld alliance of airlines, Germany’s T-mobile, France’s Orange, Spain’s Telefonica and Italy’s TIM have unveiled a joint brand entitled FreeMove and will begin rolling out shared services this year.

FreeMove will boast a combined subscriber base of 230m people and will introduce synergies into the member networks that include greater economies of scale, including bulk purchasing of handsets. FreeMove is understood to have already struck a handset deal with Motorola and Siemens, acquiring 6m phones at an average cost saving of 10pc.

The new alliance, which could eventually grow to include Vodafone-rival networks in markets like Ireland and the UK, will initially focus on the €4bn European business market.

A similar alliance already exists in the shape of UK’s MMO2 and Norway’s Telenor. Other such alliances are being created by operators seeking to pool their efforts in rolling out expensive 3G networks.

Vodafone, with some 130m subscribers around the world, has seized the initiative in the mobile industry, using its network of networks to provide users with seamless roaming and simple access to voicemail and mobile internet applications while on the move.

FreeMove intends to be able to provide similar accessibility and simplicity of use across 21 European countries before targeting a similar initiative in the Americas next year.

By John Kennedy