Virgin Media O2 will invest £343 million to acquire 78.8 megahertz of spectrum from Vodafone UK, pending Ofcom approval
In sum, what to know:
£343M spectrum deal secured – Virgin Media O2 will invest £343 million to acquire 78.8 megahertz of spectrum from Vodafone UK, pending Ofcom approval, to improve mobile network performance across the country.
O2’s spectrum share hits 30% – The new holdings raise Virgin Media O2’s total spectrum share to roughly 30%, including airwaves in the 1400 MHz, 2.1 GHz, 2.6 GHz and 3.4 GHz bands.
Improved service for customers and MVNOs – The added spectrum will benefit both O2 customers and MVNOs using its network, while helping correct imbalances between UK operators and enhancing market competition.
U.K carrier Virgin Media O2 announced a spectrum transfer agreement with rival operator Vodafone UK that will see Virgin Media O2 acquire 78.8 megahertz of spectrum for an investment of £343 million.
In a release, the carrier said that this new spectrum will materially enhancing its network position and help to improve the connectivity experience of consumers and businesses across the country.
Specifically, Virgin Media O2 will acquire 20 megahertz in the 1400 MHz band, 18.8 megahertz in the 2.1 GHz band, 20 megahertz in the 2.6 GHz band and 20 megahertz in the 3.4 GHz band.
The deal, which follows the completion of the merger between Vodafone UK and Three UK and is subject to the approval of local regulator Ofcom, will bring Virgin Media O2’s total mobile spectrum share to approximately 30%.
The carrier also noted that the transfer of spectrum is part of a wider deal struck between Virgin Media O2 and Vodafone UK in July 2024 where the pair had agreed to extend and enhance their existing mobile network sharing arrangement for more than a decade. Following the completion of their merger, VodafoneThree will now participate in that network sharing agreement.
Virgin Media O2 also said that the new spectrum will benefit MVNOs who make use of the telco’s mobile network via wholesale partnerships to deliver their own mobile services to millions of people across the country.
The transfer of spectrum reduces the previous imbalances in spectrum between mobile network operators in the UK, enhancing competition, the telco said.
The spectrum will be partially funded by the minority stake sale in Cornerstone in 2024, with spectrum payments extending beyond 2025 and deployment occurring over the medium term, starting this year, the telco added.
Lutz Schüler, CEO of Virgin Media O2, said: “This acquisition of spectrum will not only create greater balance in holdings across the U.K.’s mobile networks, but for Virgin Media O2 it will allow us to boost coverage and further improve our network quality, building on the significant investment we are already making in our mobile network. We’re committed to giving our customers a reliable mobile experience across the country and this increase in spectrum will help us deliver on that.”
In February, Virgin Media O2 activated its 5G Standalone (5G SA) network for business customers in the U.K., making it available to large enterprises, public sector organizations and small and medium-sized businesses on eligible plans. The company said its 5G SA rollout now reaches 500 towns and cities across the country.
The new infrastructure supports advanced use cases such as autonomous transport, remote healthcare, and fully automated manufacturing. It also enables network slicing – allowing for the creation of dedicated connectivity for specific applications such as augmented reality, gaming, and robotics.
In November 2024, Virgin Media O2 claimed to be the first operator in the U.K. to switch on 5G SA small cells. At launch, these were installed in central Birmingham, enhancing connectivity in some of the city’s busiest areas. The compact cells were mounted on existing street furniture to target zones with the highest data demand.
Virgin Media O2 officially launched its 5G SA network in 2024, with initial coverage across London, Manchester, Liverpool, Lincoln, Birmingham, Sheffield, Glasgow, Newcastle, Leeds, York, Belfast, Cardiff, Nottingham and Slough.
The operator was formed in June 2021 as a 50-50 joint venture between Liberty Global and Telefónica, following a merger approved by the U.K.’s Competition and Markets Authority (CMA) in May 2020.
