I expected more progress on the deal as well. I don’t think Vodafone would want to jeopardize the deal though given the capex they have incurred to improve their network in anticipation of the migration and the fact that they are pegging their guidance on it.
1&1’s current contract with Telefonica runs until the end of June 2025. That means 1&1 will be about four months behind schedule in migrating their customers to Vodafone network. But I think that was already anticipated by 1&1 given that the migration from Telefonica to own network is expected to take two years. Also, customers that aren’t mobile and stay at an area where 1&1 network is strong could be migrated last, hence avoiding churn associated with poor network. But that will depend on how good the 1&1 network will be a year from now. I think 1&1 could also negotiate a short contract (probably at unfavorable terms) with Telefonica for the remaining customers.
Why do you think 1&1 will be four months behind schedule in migrating costumers?
What about the Telefonica 1&1 National Roaming Agreement that 1&1 is currently using for costumers they already migrated into their own network? How long will this one run?
Because they should have migrated their customers to the Vodafone network by the time their contract with Telefonica comes to an end at the end of June 2025 but Vodafone is guiding migration to last until October 2025.
They have 2024 and 2025 to migrate customers from Telefonica network to own Network.
Ah, sorry, I did not realize that you already linked the NRA not the MVNO.
I looked it up again and both contracts the MVNO and NRA run until June 2025 so there is no difference in terms of timelines.
Nevertheless, I think we should always be clear on the difference between them as the migration in the past was from the Telefonica MVNO to 1&1 Network + Telefonica NRA, and the second migration that started this quarter is changing the NRA from Telefonica to Vodafone or directly migrating from the Telefonica MVNO to 1&1 Network + Vodafone NRA. (See Flowchart)
Which exacts comments highlight that the Vodafone migration could take until October 2025? Those comments from the CFO indicate they could be just in time if they started at the beginning of Q3 2024?
I think you can assume that it will take us about a year to move to the full capacity and the full run rate…it will be a gradual move, because as you said it’s a large number of customers who cannot do that all in one go," he said.
Yes they will beat the timeline if they start at the beginning of Q3 (July). But so far, the migration hasn’t started (other than migration testing) and the contract hasn’t been finalized. So assuming the migration starts in October (latest period when roaming should have started), it could end in October next year.
