Networks and technology
In 2010, Telefónica O2 continued to expand and modernize its network infrastructure, which consists of the largest fixed line and mobile telecommunication network in the Czech Republic.
As far as mobile networks are concerned, investments were directed mainly at an extensive expansion of the Company’s 3G network based on the UMTS/HSPA technologies, increasing data transmission speeds, upgrading the GSM network technology and at providing for sufficient capacities now when the traffic is growing.
Compared to the situation in early 2010, when the 3G network covered only main regional cities, the network has been significantly expanded to other locations throughout the year. The number of UMTS/HSPA base stations at the end of 2010 stood at 1,835, compared to 1,364 at the end of 2009. The coverage of the population with the 3G signal increased from 26.6% at the end of 2009 to 42.5% at the end of 2010. The year 2010 also saw the completion of a massive upgrade of the 2nd generation mobile network which had been commenced in the previous year; this effectively increased the coverage of the EDGE technology, which allows for faster data transmission in network, to 97% of the territory and 98% of the population of the Czech Republic. Thanks to this, combined with the CDMA network, which covers 90.4% of the population, Telefónica O2 had, at the end of 2010, the best mobile data infrastructure in the Czech Republic.
Data traffic in mobile networks increased dynamically in 2010. In peak hours, it reached on average more than double that of 2009. Investments in network transmission capacities followed suit. Further increases in the volume of voice traffic and additional demand from new developments (residential, commercial and industrial) have led to 65 new base stations and 147 smaller transmitters, namely to improve coverage in buildings, being installed in the GSM network in 2010. At the end of 2010, the total number of GSM transmitters reached 4,995, and the coverage of the population stood at 99.6%.
In the fixed line area, a significant share of investments went into broadband and IPTV projects. To satisfy the demand from customers, Telefónica O2 expanded the capacity of access pints and strengthened the capacities of transmission lines in the IP/MPLS backbone network. The number of ADSL access points reached 2,415 at the end of 2010, compared to 2,402 in 2009. In 2010, 162 IP DSLAMs were put into operation, and O2 TV was available in 2,265 locations. The total installed capacity of ports went up to 1,050,700, which is a year-on-year increase of 7.6%. The share of O2 TV-enabled access ports installed in IP DSLAM equipment stood at 62% at the end of 2010, compared to 56% at the end of 2009. A total of 840,400 were occupied at the end of 2010 (up 11% on the previous year).
Telefónica O2 continued to roll out its access network, namely to satisfy the demand from customers in new residential, commercial and industrial developments. The access network consisted of metallic cables spanning the whole territory of the Czech Republic, supplemented with optical cables and radio relay systems. At the end of 2010, the total length of metallic cable was 305.1 thousand km (up 1.7 thousand km year on year). The optical network capacity continued to increase with the growing volume of traffic generated by broadband customers, connectivity orders from corporate customers and, in selected cases, the need to connect new residential developments. The total length of optical cable, including those laid in conduit systems, reached 31,529 km at the end of 2010, compared to 31,204 km in 2009. The total length of optical cable reached 998,691 km (a year-on-year increase by 22,889 km).
The Company also added to the capacity of two existing international telephone exchanges by building a new soft switch telephone exchange. The capacity of subscriber interfaces of HOST exchanges and Remote Subscriber Units (RSU) was optimised accordingly. At the end of 2010, the fixed line network comprised, in addition to the international exchanges, also six transit exchanges and 138 HOST exchanges. The network of RSUs was optimised by reducing their number by 10, down to 2,374.
Voice over IP services enjoyed a dynamic growth in 2010. During the year, the number of end users of the Company’s IP Centrex service doubled and reached almost 40 thousand.
The GSM network operated by Telefónica O2 Slovakia consisted of 964 base stations at the end of 2010. Network-related investments in Slovakia focused mainly on the building of own transmission capacities.
As mentioned earlier in the Annual Report, in the course of 2010 Telefónica O2 increased the share of network operation and maintenance activities contracted out to external parties, which achieved a significant saving of operating costs and their greater variability.
