Having last year merged their struggling UK divisions of Orange and T-Mobile in to a single JV, France Telecom (NYSE: FTE) and Deutsche Telekom (NYSE: DT) have each resolved go further, saving money by sharing technology in other global markets.
Areas for co-operation are yet to be confirmed but, in a joint statement, the pair say “potential” areas are network sharing, roaming WiFi and harmonising equipment and equipment communication standards. They also want co-op on home media, e-health, connected cars, in-car infotainment, and TV/video standards.
With such close co-operation, could the pair yet merge at the global, as well as UK, level? Well, FT buying DT may be undesirable, considering the French government holds a stake in the former but likely wouldn’t want the latter. That wouldn’t preclude a JV of equals – but carriers the world over have already been starting to share networks without the need for such formalities.
The tie-up means “operational efficiency issues in a limited and targeted set of business domains” but also consumer benefits. Customers of either network will get to use the other’s WiFi networks whilst traveling: “Both groups share the conviction that the international traveller of tomorrow will want to be able to download large amounts of data, for private or business reasons, without having to be burdened with the choice between WiFi access and 3G mobile access.”
The UK T-Mobile/Orange JV is operated by a single holding company named Everything Everywhere. Each carrier retains its identity and stores but is making large back-office savings. Now Everything Everywhere is even planning its own-brand, Apple-style modern stores.