mobiletech
Vodafone Takes a Hit, But Unveils New Strategy
Filed in archive Operators by Scott on May 30, 2006
Vodafone Takes a Hit, But Unveils New Strategy
Global mobile giant Vodafone posted a £14.9 billion loss for 2005 on tuesday morning London time, the largest annual loss by a European company, according to the press, but raised its dividend and announced it would increase the amount returned to investors.

Looking for future growth, the company said it will follow its competitors into broadband in some countries and has created a unit called "New Businesses" to pursue fixed-mobile convergence, and said it faces a complex operating environment:

"Notable changes in the environment include customers increasingly seeking products and services which meet their total communications needs, a greater desire for simplicity and value, the emergence of new technologies, intensifying price competition and regulatory pressure."

It also said it will boost efforts in creating "family plans" and easier, lower-cost roaming.

All in all, this strategy focuses on more organic growth through service expansion, rather than through wholesale acquisition of customers by buying rival operators. Like BT did in the UK a few years ago, Vodafone is entering a phase where it reorients its strategy and investments toward growing a portfolio of services that is highly segmented, and extends the reach of its operations out of its "old" core business of mobile services and into the whole area of communications and media.

Can Vodafone succeed with this refocus toward "build" instead of "buy"? The market certainly demands it, and with growing complexity of services and a demand for value by consumers, Vodafone has to wring some efficiencies out of its scale and focus more on the whole living patterns of its customers instead of single points of social and communication activity as it has done so far.

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Tags: vodafone  strategy 
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