This was revealed today by Expansión, which states that Orange and Banco Santander have reached an agreement by signing a contract with a duration of 20 years. The agreement is necessary by Orange because the operator wants to finance fiber optic deployments in Spain, but does not currently have sufficient funds to do so.
400 million euros to deploy fiber to 3 million real estate units
For this, it will have the help of Banco Santander, which will make an investment of 400 million euros in the fiber network, and it will be the bank itself that rents those networks to Orange through a leasing contract. Thanks to this, Orange will be able to grow faster in the short term, while Banco Santander secures income for the future through this investment. The deployment of this new infrastructure will take place in the next four years, starting from the beginning of 2020, so everything that Orange has deployed during the first half of the year will be included.
This type of deployment strategy is quite novel in Spain, where it is not common to see a separation in the ownership and commercialization of networks, where operators have always sought to guarantee the ownership of these networks as an important asset in order to obtain greater long-term profitability. MásMóvil was the first to explore this model, where it participates in deployments of some neutral networks where they are the main client.
However, market sources claim that the network will be 100% owned by the operator when the deployment ends in 2023. Thus, Orange would go from 14.3 million homes to 17.2 million at the end of 2023. Movistar currently has 23.65 million real estate units.
Fiber optics already covers 80.4% of the Spanish population
Spanish operators are currently also receiving aid to carry out fiber deployments in areas where it is not profitable to do so thanks to the PEBA-NGA plan of the Spanish government. According to the latest available data, fiber optics already reaches 80.4% of the Spanish population. However, there are still many gray and white areas where either a deployment is not planned, or there is only one operator offering coverage.
Operators like Movistar affirm that by 2025 the entire Spanish population will have fiber optic connections, and that copper will be a thing of the past. Joint deployments by operators have helped a lot to lower costs, where almost all operators have some kind of agreement to share deployments, or Orange and Vodafone can access the Movistar network in non-competitive municipalities.
Orange’s fiber coverage will thus be able to continue growing without short-term financing problems, on a path that continues to progress little by little to eliminate copper in our country, and which could make us one of the first in the world. world to achieve it. Spain is the European country with the most kilometers of fiber optics, and the efforts of the operators have resulted in the possibility of teleworking from almost any part of the country with an ultra-fast connection.