Telefonica to launch 4G in Spain following network-sharing agreement with rival Yoigo

Telefonica, Spain's biggest mobile operator, will finally launch 4G services after signing a deal with fourth-placed Yoigo to share networks. 

As part of the deal Yoigo will also get access to Telefonica's broadband infrastructure, meaning the smaller operator will be able to offer fixed-line broadband services to homes and businesses alongside its mobile offerings. 

Yoigo, owned by TeliaSonera, will also have access to Telefonica's 2G and 3G network infrastructure across Spain, which will help it reach regions where its coverage doesn't currently reach. That agreement will run until 2016, when Yoigo hopes to have completed its nationwide 4G network rollout.

The company is currently on course to have 48 percent of the population covered by the end of this year. Every city with more than 70,000 inhabitants will be covered, Yoigo said.

The deal to use Yoigo's network, announced on Thursday, will mean Telefonica will be able to offer 4G services without building its own network, although the company said it does still plan to do so in future. According to Reuters, the spectrum awarded to Telefonica in Spain's recent auction remains taken up by TV broadcasts.

The deal is expected to be finalised in the fourth quarter of 2013, when Telefonica will be able to offer 4G via its Movistar brand. It will become the final major mobile operator in Spain to offer 4G services.

The move to allow Yoigo to offer broadband and television services alongside mobile increases the competition between Spain's four mobile operators: Telefonica's Movistar, Orange, Vodafone and Yoigo. 

The latter is the smallest of those with around 3.2 million subscribers. That figure has been growing rapidly due to the low cost tariffs the company offers, but many cash-strapped Spaniards have been looking to bundle their broadband, television and mobile subscriptions into one package, which Yoigo has not been able to do before now.

As part of the deal, Telefonica and Yoigo said they have sold mobile infrastructure towers to Spanish conglomerate Abertis for €385m.

It’s been a busy time for Telefonica’s 4G deployments. The company has also announced its UK arm O2 will launch 4G in three cities — London, Leeds and Bradford — by the end of the month. It will become the second 4G network in the UK, after EE's launch late last year.