VodafoneThree announces £11bn investment. What can you expect?
VodafoneThree is making a fast start on turning its promises into reality. Amongst its priorities is network convergence and more specifically delivering 99.95% 5G population coverage.
It will happen on a financial scale we’ve not witnessed before. The £11bn investment makes it one ‘of the largest privately funded infrastructure programmes in the UK’. Aside from delivering all kinds of speed benefits, it’s expected to remove a total of 16,500 sq/km of ‘not spots’.
This is of course great news for consumers, especially those who are crying out for consistent, reliable coverage in more rural areas. High speed networks will also be pivotal to businesses that want to harness IoT, AI and all the applications that underpin a more productive workforce.
The plan to deliver the ‘fully funded, regulated, and guaranteed’ network will be music to the ears of the regulator as it meets the reasoning for waving the merger through.
It will take a while to complete the mammoth job, but all credit to the team – they are out of the blocks fast. That will also be reassuring to the government, which will be glad to see up to 13,000 jobs are plumbed into the plans.
However, there was no information about how the network improvements will benefit MVNOs. The release made no reference as to how or when MVNOs such as Asda, iD, Gamma, Lebara will gain. Clarification from the press office, however, confirmed they will benefit but it’s not going to be immediate.
When VodafoneThree does deliver parity, then it will be great news for consumers using the MVNOs. But if it takes time, or if there are technical challenges, then it could trigger some difficult conversations between VodafoneThree and the MVNOs as they will rightly demand parity of access.
One of the positives for consumers is news that the multi-brand mobile strategy will continue. Vodafone, Three, VOXI, SMARTY, Talkmobile all endure.
This suggests the new entity thinks each of the brands is sufficiently differentiated to hold its own in the market. I did expect some adjustments here, but I suppose it could be argued that there is more to lose by cutting them.
Keeping all the brands will further help to allay some of the fears on jobs. Though there will need to be some rationalisation on duplication in HQ, 400 jobs are expected to be created in service centres in Belfast and Sheffield, and there are no planned redundancies in retail.
On the topic of jobs, you’ve probably seen that LinkedIn has been buzzing with news on who has got the roles in HQ. I’m especially pleased to see the female representation as the new leadership team forms, and I congratulate everyone who has secured appointments. The industry will benefit from diverse leadership in all its forms and I hope we can see more progressive inclusion in the sector as a whole.
What material difference will all this make to you as a consumer?
This time next week the first benefits will start to come through as Three and Smarty customers receive a 20% average 4G speed boost.
And by Christmas, 27 million Vodafone and Three customers will benefit from the ability to freely access the two networks.
As for the brand, we should expect to see more emphasis on broadband as it becomes the (and I paraphrase their release) ‘UK’s largest full fibre provider’. I’m sure we’ll learn more about how it will compete in this busy space over the summer.
It’s something to keep an eye on as competitor brands start to make their moves. Consumers will want to get full value from their full fibre and but won’t want to pay over the odds. There could be some enticing offers coming into ad-land soon.
Business propositions will all come under the Vodafone brand, which is pretty much what we predicted as it leverages Vodafone’s strength in this area.
I think it’s a real shame for the Three Business team, which has made strong progress into the segment, hitting a slice of the market that wanted something less corporate and more flexible. They’ve brought some interesting propositions to market and been a significant challenger on pricing.
It therefore goes without saying that I’m excited to see some of the business team move into the wholesale team where they will be able to apply their experience and expertise to the dynamics of the ever-changing MVNO market.
As ever, time and money is what’s needed to make all of this happen. As a consumer, I’d stay on top of the deals as there will be some good ones for anyone in the market ready to change contracts.
MVNOs have a lot to gain in this space and could be aggressive on two fronts. Firstly they could disrupt with some great headline offers. Nothing new there but they could up the ante with advertising.
And secondly, they could take advantage of the growing appetite for eSIM. One way to pitch it is to encourage people to have a ‘back up plan’ whilst the network integration happens.
By using phone settings to choose the best bearer, consumers won’t feel any downsides to interruptions to service. (It’s what I do now, naturally with an MVNO SIM and it allows me to access Vodafone, Three and BT for data services).
Main takeaway is that this isn’t a time to fall asleep on watch. There will be some great skills coming into the market from HQ, there will be some opportunities to swoop in while the HQ is distracted with network priorities and there’s wiggle room to negotiate on wholesale deals.
As ever, it’s all to play for!
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