Vodafone CEO Nick Read outlines growth strategies

Nick Read, who succeeded Vittorio Colao as Cchief executive officer of Vodafone in October 2018, has revealed the strategic priorities for the struggling telecom operator.

Vodafone reported 5.5 percent drop in revenue to €21.8 billion and loss of €7.8 billion in the first half of fiscal 2018-19.

Vodafone has already identified five drivers to ensure sustainable revenue and free cash flow for growth in the telecom business. Vodafone, made late entry into 4G business, said its focus will be on 4G.

“The foundation of our strategy is our significant investments in leading 4G wireless and next generation fixed networks, which continue to support an excellent customer experience,” said Nick Read announcing the company’s financial results.

European Consumer segment accounted for 49.1 percent of Group service revenues in the first half of fiscal 2018-2019. Vodafone aims to drive growth in the Europe Consumer segment by developing customer relationships.

Vodafone aims to both cross-sell additional products such as broadband, family SIMs, TV and up-sell new experiences including higher speeds with 4G Evo / 5G, low latency mobile gaming services and a range of Consumer IoT devices.

The objective of Vodafone is to increase revenue per customer and to significantly reduce churn as an increasing proportion of customer base becomes converged over time.

Vodafone intends to launch 5G services in-line with local competitors during calendar 2019 and 2020, with an initial focus on dense urban areas.

Vodafone expects that 5G’s improved spectral and energy efficiency supports up to a 10x reduction in the cost per Gigabyte, which will allow the Group to limit the future growth in network operating costs despite strong expected traffic growth.

Vodafone’s fixed network reaches 117 households in Europe following the acquisition of Liberty Global’s cable assets. Vodafone aims to offer gigabit-speeds via DOCSIS3.1 on Cable and via FTTH to most of these homes in the next few years.

Vodafone Group has 20.4 million broadband customers, 6.2 million converged customers and 13.7 million TV customers. Vodafone added 384K broadband customers, 744K NGN customers and 616K converged customers. Vodafone lost 71K TV customers.

Vodafone Business accounted for 29.8 percent of Group service revenues. Vodafone is in the process of re-branding its former Enterprise division as Vodafone Business.

The strategy for Vodafone Business is to drive growth and deepen our existing mobile customer relationships by cross-selling additional services including next generation fixed, IoT and Cloud services.

“We aim to increase revenue per account and reduce churn, while improving productivity through our salesforce transformation initiative and the rapid digitalisation of our operations,” Nick Read said.

Vodafone said its local corporate / government customers represent 30 percent of Business revenues. Vodafone’s IoT connections rose 28 percent in Q2 to 77 million, while IoT revenue growth was 14 percent in H1.