Drillisch bolsters German MVNO play – Mobile World Live

Drillisch bolsters German MVNO play

27 MAY 2015

Drillisch saw its status as the emerging competitive threat to Germany’s incumbent mobile operators boosted by two deals.

The MVNO has taken over 301 shops and 300 employees from Telefonica Deutschland, one of the conditions attached to the operator’s acquisition of German rival E-Plus.

In addition, local cable operator United Internet has purchased a further nine per cent stake in Drillisch through its United Internet Ventures subsidiary. The cable operator now has an indirect holding of 21 per cent in the MVNO, making it the largest shareholder.

However, the deal will need approval of Germany’s Federal Cartel Office, since United Internet is also an MVNO in its own right.

The attraction of Drillisch is its unique position in the German mobile market. It gained from Telefonica Deutschland agreeing to sell it up to 30 per cent of the capacity on its network (in addition to handing over shops).

The capacity is being made available under a bitstream model that is preferable to standard resale arrangements. Drillisch is the sole purchaser of the capacity.

United Internet was thought to be in the running for a similar deal with Telefonica but lost out to Drillisch. Potentially, closer links with the MVNO could mean United Internet offering a stronger quadplay offering to consumers.

However the cable operator does not currently intend to increase its stake to 30 per cent or more in Drillisch, which would oblige it to submit a mandatory offer to all shareholders. Nor does it intend to make a voluntary takeover, it said.

Earlier this month Drillisch argeed to buy the German unit of The Phone House from Dixons Carphone.

Following the acquisition of E-Plus, Telefonica Deutschland has around 1,750 of its own and partner shops. However, there is overlap between the two retail chains. Telefonica Deutschland pledged to reduce the number of shops by one third over the next five years.

Author

Richard Handford

Richard is the editor of Mobile World Live’s money channel and a contributor to the daily news service. He is an experienced technology and business journalist who previously worked as a freelancer for many publications over the last decade including...

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