French threat prompts UK operators to strike Channel Tunnel deal

UK network operators were reluctant to invest in providing services within the Channel Tunnel until Eurotunnel, the group that operates the Channel Tunnel transport network, threatened to offer the provision of network coverage exclusively to French operators.

A spokesman for Eurotunnel told Telecoms.com that the proposal to offer the deal to French carriers was “one of the key turning points” in sealing deals with UK operators EE and Vodafone.

There are two separate lines that make up the Channel Tunnel – one going UK to France and the other running the other direction. French carriers secured a service provision deal for the France – UK leg, while UK operators were expected to provide coverage in the other direction.

Last week, EE and Vodafone signed ten-year contracts with Eurotunnel to provide 2G and 3G services to their subscribers while travelling on the undersea rail line. The services are expected to launch in March 2014.

However, Eurotunnel announced deals with French operators Bouygues Telecom, Orange and SFR as long ago as March 2012, and those services were live by July 2012.

“The French wanted to get in really quickly, they were pushing us as much as anything else because they wanted to have the connectivity in time for the Olympics,” Eurotunnel’s spokesman said. “For them, because their customers came from the other side of the tunnel, giving their customers connectivity on the way was a good piece of marketing.”

Conversely, interest from UK operators was weak in 2012 as many of their subscribers would stay in the UK that year. In addition, there was more collaboration on the French side between operators and the equipment supplier, Alcatel-Lucent, because it is also a French organisation, Eurotunnel said.

“The British weren’t so interested to begin with,” the spokesman said. “To be perfectly honest, there is not a strong economic case for them; there is a marginal customer base in the tunnel, and they took a very hard economic line and said ‘we’re not really interested in this because there’s not lots of money in it for us.’

“So we would have had French operators providing connectivity on both legs of the tunnel. That proved to be one of the key turning points because nobody seemed terribly keen to have French networks operating under roaming charges in the UK, so the UK operators looked at it a little more favourably and eventually came on board.”

Vodafone said that its agreement with Eurotunnel was held up by “cost and technical issues”.

“I couldn’t comment on what Eurotunnel may or may not have done had we not committed, we were just happy to have the opportunity to be involved,” a spokesman for the operator told Telecoms.com.

A source at EE admitted the launch of its 4G network was the firm’s focus in 2012. They added that, as a result, there were concerns from a technical perspective over the quality of service if it was to undertake the Eurotunnel project that summer. It says it is now confident those concerns have been addressed.

“From a technical perspective, I don’t think our team was confident that the solution would be great quality if it was done back in summer 2012, and they were reluctant to launch something that was poor performance. Of course, LTE at 1800MHz was not an option for us then as the spectrum had not been liberalised.”

Eurotunnel has previously stated that it has also held talks with O2 and 3UK but is yet to reach an agreement with either operator. O2 does, however, have a RAN sharing agreement in the UK with O2, and a source close to the project told Telecoms.com that they suspect the operator may use this agreement to provide connectivity on the tunnel to its own subscribers.

An O2 UK spokesperson said he was unaware of any such plan but confirmed the operator’s discussions with Eurotunnel are ongoing.