Vodafone data centre


Vodafonewatch
This release
: #171
January 2019: 78pp
Releases/year: 10+
Click for more details of this release

EXECUTIVE BRIEF

GROUP

Deals: Vodafone turns to IBM for leg-up in cloud [p.6]

  • Fineprint not yet apparent
  • BOGO with forgotten VESS?
  • New broom for Vodafone Business, new squeeze on partners?

Legal and Regulatory: Vodafone to replace PwC as Phones 4u lawsuit lands [p.11]

  • Court action confirmed, Orange and DT dragged in
  • Dunne's calls reportedly in focus

Network: Vodafone goes on SDN pilot for microwave backhaul [p.13]

  • Table: SDN steers microwave backhaul: fab‑four use‑cases based on the SM‑DC
  • Group warms up on microwave
  • Table: Backhaul capacity requirements per radio site for operators at two different stages of mobile broadband evolution

Partnerships: Vodafone duet hits right notes for Elisa [p.16]

People: Telco Cloud boss swaps Vodafone for Nokia [p.18]

  • New regime, new priorities
  • Table: People movement highlights

Supply Chain: Vodafone seeks to ride out Huawei firestorm [p.23]

  • VHA's Berroeta plays down ban impact
  • Muddiness in Czech Republic and Germany
  • Pain not in Spain; backing in Italy
  • OK in UK, says Read -- but picture more troublesome
  • Political forces swirl
  • Table: Partner/supplier people movement highlights

EUROPE REGION

Germany: VfD mounts legal challenge against 5G auction rules [p.29]

  • BNA under the hammer
  • GSMA puts its oar in
  • Table: MNO moans: GSMA rundown on what's wrong with 5G auction rules in Germany

Hungary: Vodafone Hungary wraps up 2.1GHz extension [p.32]

Ireland: VfIr pushes 5G boat out with Ericsson [p.34]

  • On the rural broadband trail
  • Figure: Ireland, fixed-line broadband market share comparison
  • VfIr's fibre challenge needs a wireless leg‑up

Italy: VfIt CEO gives guarded support for broadband NetCo [p.39]

  • Towering ambition
  • Milan 5G and Huawei updates

Netherlands: VfZ taps Cisco's latest SON tech for 5G RAN automation [p.42]

  • Nice one, SON
  • Close buddies
  • RAN radicalisation

Romania: Telcos on hook in government 'Greed Tax' grab [p.46]

  • Liberty won't be too bothered

Spain: Struggling VfS takes lead on Group's 'tactical' rethink [p.48]

  • Figure: Vodafone Spain adjusted EBITDA margin, FY16-19
  • Spain the flashpoint of Vodafone's Group-level strategy errors
  • VfS kicks copper to the kerb
  • Tele2: end of the line

UK: VfUK gets more streetwise on small-cell rollout [p.52]

  • Little sign of JCDecaux
  • O2 and Vodafone extend sharing to 5G, with passive focus
  • A deeper partnership underground, more
  • independence at the business end

AFRICA, MIDDLE EAST, AND ASIA-PACIFIC REGION

Vodafone Hutchison Australia: TPG tie-up brings VHA out of spectrum shell [p.58]

  • New buddy TPG already having an impact
  • Table: Australia 3.6GHz auction results, by region
  • Merger and spectrum: next steps key
  • Competition regulator punctures the mood

Ghana: VfGh coughs up for 800MHz concession [p.62]

  • 4G launch coming

India: Airtel keen on a VfI infrastructure super-meld [p.64]

  • Capital ideas: VfI already looking beyond merger to shore up business

New Zealand: Vodafone New Zealand preps job cuts [p.67]

  • Digitisation, automation, outsourcing… all boxes ticked

Vodacom Group: Safaricom tests out Huawei's low-touch TubeStar tower [p.69]

  • Network still a key competitive weapon

FURTHER READING

INDEX

Symbols

3rd Generation Partnership Project (3GPP) 34

A

Aditya Birla Group

 - Idea Cellular 22, 63

Africa 20, 57, 62, 68, 70, 71, 74

 - Congo 62

 - Ghana 22, 62, 63, 74

  --  National Communications Authority 62, 74

 - Kenya 68, 69, 70

  --  Central Bank of Kenya 68

 - Nigeria 22, 71

 - South Africa 61, 68, 71

 - Sub-Sahara 20

 - Uganda 22

Airsweb 27

Alcatel-Lucent 18, 21

Alfa Group

 - Altimo (Alfa Telecom International Mobile)

 - Turkcell (see Curkurova/ TeliaSonera/separate) 22

Alibaba Group Holding Ltd 72

Altice Group 45

Altran Technologies, SA 41

Amazon.com Inc. 20, 21, 51

 - Amazon Web Services 20

América Móvil 56

American Tower Corp. 65

Americas

 - Canada 26, 45

 - Latin America 10, 44, 70

 - USA 8, 9, 10, 24, 26, 51, 63, 65

  --  Commerce Department 26

  --  government 26

  --  Government 72

Asia-Pacific 20, 23

 - Australia 24, 26, 58, 59, 60, 61, 74

  --  Australian Communications & Media Authority (ACMA) 60

  --  Competition & Consumer Commission 61, 74

  --  National Broadband Network (NBN) 60

 - China 23, 24, 25, 26, 41, 69, 72

 - India 8, 22, 63, 64, 65, 66, 74

  --  Cellular Operators Association of India (COAI) 65

  --  Department of Telecommunications (DoT) 74

  --  Telecom Regulatory Authority of India (TRAI) 65, 66

 - Japan 26

 - New Zealand 26, 66, 67, 68, 71, 74

Astorg Asset Management

 - M7 Group 10

Australian Competition and Consumer Commission (ACCC) 61, 74

Axiata Group Bhd (TM International)

 - India (Idea Cellular, see also Aditya Birla) 8, 22, 44, 63, 64, 66, 74

B

Banco Santander, SA 21

Bharti Group 64, 74

 - Airtel 63, 64, 65, 70, 74

 - Africa

  --  Ghana 63

  --  Kenya 70

 Bharti Infratel 64, 74

 - Indus Towers 22, 64, 65, 74

British Broadcasting Corp. (BBC) 74

British Standards Institute (BSI) 24

BT Group 8, 10, 20, 21, 26, 27, 52, 55

 - BT Global Services 8

 - Openreach 21, 52

C

Capgemini 20

Cisco Systems 16, 42, 43, 44, 73

Comcast Corp. 10

Cukurova Holding

 - Turkcell (see Altimo/TeliaSonera/ separate) 22

D

Dell 9, 27

Dell Technologies 9, 27

 - Dell EMC 9, 27

  --  RSA Security 27

 - VMware 14, 27

Deloitte Touche Tohmatsu 12

Deutsche Telekom 8, 10, 12, 17, 23, 30, 36, 47

 - Europe

  --  Greece (see OTE) 36

 --  Germany 29, 36

  --  Hungary (see Magyar Telekom) 32, 73

  --  UK (EE) 12, 26, 71

 - Investments

  --  Magyar Telekom (see separate) 32, 73

  --  OTE (see separate) 47

 - Systems Solutions

  --  T-Systems 8

E

EE (see DT, FT) 12, 26, 71

Elisa 16, 72

Emblaze Group

 - European Telecom 17

EMC 9, 27

  - RSA Security 27

 - VMware 14, 27

Enel SpA 40

Eni SpA 10

Ericsson 14, 15, 17, 24, 25, 34, 35, 36, 52

Europe 9, 10, 20, 23, 28, 30, 44, 49, 73

 - Austria 10

 - Czech Republic 10, 21, 23, 24, 31, 72

 - Estonia 16

 - Finland 16, 18, 20

 - Germany 6, 24, 29, 30, 31, 34, 36, 37, 71, 72, 73

  --  Bundesnetzagentur für Elektrizität, Gas, Telekommunikation, Post und Eisenbahnen (BNetzA, RegTP, FNA, or German Federal Network Agency) 29, 30, 31, 73

  --  Government 24

  --  Länder

   ---   North Rhine-Westphalia (Düsseldorf) 34, 36

 - Greece 31, 47

 - Hungary 10, 31, 32, 33, 47, 73

 - Ireland 6, 10, 34, 35, 73

  --  Commission for Communications Regulation (ComReg) 35

 - Italy 10, 14, 15, 21, 23, 25, 31, 36, 37, 39, 40, 41, 71, 73

  --  Cassa Depositi e Prestiti 40

  --  Government 39

 - Luxembourg 20

 - Netherlands 10, 31, 37, 42, 45, 73

 - Poland 10

 - Portugal 45, 73

  --  Competition Authority (AdC) 45

 - Romania 10, 15, 31, 46, 47, 73

  --  Autoritatea Naţională pentru Administrare şi Reglementare în Comunicaţii (Ancom/ANC/ ANRCTI/ANRC) 46

 - Spain 23, 25, 26, 48, 49, 50, 51, 72, 73

 - Sweden 15, 34, 36

 - Switzerland 10

 - Turkey 15, 22, 26, 37, 44

 - United Kingdom (UK) 6, 10, 11, 12, 15, 21, 25, 26, 27, 37, 52, 53, 56, 71, 72, 73

  --  British Standards Institute (BSI) 24

  --  Office of Communications (Ofcom) 53, 56

European Telecommunications Standards Institute 17

European Union 41

 - European Commission 10, 41, 47

Evolving Systems 27

F

F2i 37

Facebook 22, 44, 71

Ferrari 74

Fiat 10

FiberCo 40

Fininvest S.p.A

 - Mediaset 10

G

Google 22, 71

 - Google Play 71

GSM Association (GSMA) 30, 31, 73

H

Huawei Technologies 14, 15, 17, 23, 24, 25, 26, 41, 58, 59, 69, 70, 72

Hutchison Whampoa 74

 - Vodafone Hutchison Australia Pty Ltd (VHA, (see Vodafone) 24, 58, 59, 60, 61, 74

I

IBM 6, 7, 8, 9, 18, 41, 63, 71, 72

Indus Towers 22, 64, 65, 74

Intel 17

J

JCDecaux Group 52, 53

Juniper Networks 14

K

KPMG International 12

L

Legal & General 16

LG Electronics 16

Liberty Global 10, 47

 - Virgin Media 35

 - Ziggo 44, 73

London Stock Exchange 20

M

Magyar Telekom (see DT) 32, 73

Market segments

 - Mobile broadband 15

 - Mobile virtual network (MVNA/ MVNE/MVNO) 30, 37

 - M-payment 71

 - Outsourcing 7, 64, 65, 68

 - Value-added services (VAS) 31, 37

 - Voice 43, 45, 66

Microsoft 71

Middle East

 - Iran 26

Millicom International Cellular 10

 - Tigo Ghana 63

Morgan Stanley 47

MTN 27, 63, 68

 - Ghana (Scancom) 63

 - South Africa 68

N

Netcracker Technology 18

Netflix Inc. 51

Nokia 18, 19, 20, 21, 25, 27, 41

 - Alcatel-Lucent 18

Novabase SGPS SA 17

NZ Communications

 - 2degrees 22, 66

O

Ofcom (UK) 55

Oger Telecom

 - Cell C 68

Omnicom

 - DDB 66

Orange

 - Kenya (Telkom Kenya, see separate) 70

 - Orange 12, 46, 47, 49, 51, 72

 - Romania 46

 - Spain 49, 51

 - UK (see EE) 12, 26, 71

OTE (Hellenic Telecom. Org. SA, see DT) 47

 - Cosmote 36

  --  Greece 36

P

Phones4U 11, 12, 72

PwC 11, 12

Q

Qualcomm 41

R

Regions

 - EMEA

  --  UK 54, 55, 73

 - Latin America

  --  Central America 56

  --  El Salvador 56

  --  Guatemala 56

S

Safaricom 22, 68, 69, 70, 71, 74

 - Executives

  --  Rerolle, Thibaud 69

 - M-PESA 17, 68, 70, 71

Samsung 16, 25

SIAE MICROELETTRONICA 13, 14

Singapore Telecom

 - Optus (Australia) 59

Sky Network Television 61

Sopra Group 20

Spotify Ltd 51

Standard Bank 22

Steria Ltd 20

Swedbank 16

Swisscom

 - Fastweb 41

T

Technologies

 - 5G 54, 55, 73

  --  NGN 54

Technology

 - 2.5G 60

 - 2G 33, 43, 46, 53, 60, 63, 68

  --  GSM 30, 73

 - 3G 24, 30, 32, 33, 37, 46, 63, 68

  --  Evolved HSPA (HSPA+/I-HSPA) MIMO 36

 - 4G 15, 24, 26, 30, 32, 37, 39, 40, 42, 43, 50, 52, 53, 60, 62, 65, 68, 73, 74

  --  Long Term Evolution (LTE) 24, 36, 62

 - 5G 6, 13, 15, 23, 24, 25, 26, 29, 30, 31, 32, 33, 34, 35, 36, 39, 40, 41, 42, 43, 46, 52, 53, 58, 59, 60, 65, 72, 73, 74 AI 6, 24, 63, 71, 72

 - Cloud computing 6, 7, 8, 16, 18, 19, 20, 21, 37, 45, 63, 71, 72, 74

 - DSL 36, 50, 51, 73

 - DTH 10

 - Fibre 13, 15, 22, 25, 35, 36, 40, 50, 51, 52, 64, 65, 74

 - FTTP 36, 40

 - IoT 6, 9, 20, 22, 24

 - IP 15, 44, 45

 - Linux 17

 - Open-source 44

 - PC 20

 - RAN 42, 43, 44, 73

 - R&D 25, 26

 - RF 15, 70

 - Spectrum 15, 24, 30, 31, 32, 33, 34, 35, 41, 47, 53, 56, 58, 60, 62, 63, 65, 73, 74

  --  700 MHz 31, 33, 53, 56, 60

  --  800 MHz 31, 33, 62, 63, 74

  --  850 MHz 60

  --  900 MHz 33, 60, 63

  --  1000 MHz 32, 33

  --  1800 MHz 33, 60, 63

  --  2100 MHz 31, 32, 33, 60, 63, 73

  --  2500 MHz 60

  --  2600 MHz 31, 33

  --  3500 MHz 24, 33

 - USSD 71

 - W-LAN 35

Tele2 50, 51

 - Italy 51

 - Spain 50, 51

Telecom Infra Project 44

Telecom Italia 10, 37, 39, 40, 41, 73

 - Telecom Italia Mobile 37, 40

Telefónica Group 12, 17, 21, 25, 27, 29, 44, 49, 50, 56, 71

 - Europe

  --  Espana 49, 50

   ---   O2 54, 55

  --  UK 12, 21, 54, 71

 - Global Resources

  --  Cornerstone Telecommunications Infrastructure 55

TeliaSonera

 - Turkcell (see Alfa/Curkurova/ separate) 22

Telkom Kenya Ltd (Orange Kenya) 70

Telkom South Africa 68

Telstra 59

Tesco 21

Texas Pacific Group (TPG) 58, 59, 60, 61, 74

T-Systems 8

Turkcell (see Alfa/Curkurova/ TeliaSonera) 22

Twenty-First Century Fox

 - Sky

  --  Sky Italia 40, 41, 73

Twitter Inc. 61, 71

U

Unilever 22

UPC 10, 47

V

Vodacom Group 17, 22, 62, 68, 69, 70, 71, 74

 - Congo 62

 - Group 17, 22, 68, 69, 70, 71, 74

  --  Mozambique 62

 - Products

  --  Please Call Me 71

 - South Africa 61, 68, 71

 - Tanzania 71

 - Vodacom Business 22, 71

Vodafone

 - Africa, Middle East, and Asia Pacific Region (AMAP) 57, 74

  --  Africa 20, 57, 70, 74

  --  Asia 20, 23

  --  Australia 24, 26, 58, 59, 60, 61, 74

   ---   VHA Pty. Ltd (see Hutchison Whampoa) 24, 58, 59, 60, 61, 74

  --  Ghana 22, 62, 63, 74

  --  India 22, 63, 64, 65, 66, 74

   ---   Indus Towers 22, 64, 65, 74

  --  Kenya (see Safaricom) 22, 68, 69, 70, 71, 74

  --  Mozambique 62

  --  New Zealand 22, 26, 61, 66, 67, 68, 71, 74

  --  Pacific 20, 23

  --  South Africa (see Vodacom) 17, 22, 61, 62, 68, 69, 70, 71, 74

  --  Turkey 15, 22, 26, 37, 44

 - Corporate

  --  Vodafone Investments

    ---   Luxembourg Sarl (VIL) 74

 - Europe Region 28, 49, 73

  --  Cable & Wireless Worldwide 7, 56

  --  Czech Republic 10, 21, 23, 24, 31

  --  Germany 6, 19, 20, 21, 24, 29, 30, 31, 34, 36, 37, 71, 72, 73

   ---   KDG Holding GmbH (KabelDeutschland) 21, 37

  --  Greece 31

  --  Hungary 10, 31, 32, 33, 47, 73

  --  Ireland 6, 10, 17, 20, 27, 34, 35, 36, 73

  --  Italy 10, 13, 14, 15, 21, 23, 25, 31, 36, 37, 39, 40, 41, 71, 73

  --  Netherlands 10, 31, 37, 42, 44, 45, 73

   ---   VodafoneZiggo 10, 42, 45, 73

  --  Portugal 17, 45, 73

   ---   CelFocus (see Novabase) 17

  -- Romania 10, 15, 21, 31, 46, 47, 73

  -- Spain 21, 23, 25, 26, 48, 49, 50, 51, 73

   ---  Grupo Corporativo Ono (ONO) 51 

  -- UK 6, 10, 11, 12, 15, 20, 21, 25, 26, 27, 37, 52, 53, 56, 71, 72, 73

  ---  Talkmobile 56

 - Executives

  --  Adams, Jessica 21

  --  Ametsreiter, Hannes 21, 36

  --  Berroeta, Inaki 24, 60

  --  Berry, Brad 9

  --  Bisio, Aldo 25, 39

  --  Brocklesby, Chris 21

  --  Colao, Vittorio 15, 49

  --  Cuba, Yolanda 62

  --  Dama, Bala 22

  --  Essam, Ahmed 20

  --  Heeran, Fran 18, 20

  --  Joosub, Shameel 71

  --  Kuisch, Eric 19, 21

  --  Mack, Gerhard 21

  --  Marnewick, Hymie 22

  --  Paris, Jason 67

  --  Quario, Giulio 13

  --  Read, Nick 6, 19, 25, 48

  --  Reiter, Joakim 65

  --  Ripepi, Alberto 20

  --  Roman, Francisco 48

  --  Rossi, Eva 13

  --  Sardo, Pedro 20, 21

  --  Shields, Delina 22

  --  Suceveanu, Madalina 20

  --  Vast, Virginie 20

  --  Wibergh, Johan 19

 - Ex-executives

  --  Amzallag, David 18

  --  Aue, Mark 22

  --  Banerjee, Siddharth 22

  --  Brunet, Karine 19, 20

  --  Jejcic, Pablo 19, 20

  --  Kolade, Lanre 22

 - Group 9, 16, 20, 22, 44, 64, 74

  --  Partner Markets 16, 17

   ---   Belgium (Proximus) 10, 37

    ---   Estonia (Elisa) 16, 72

   ---   Finland (Elisa) 16, 72

   ---   Kenya (Safaricom) 22, 68, 69, 70, 71, 74

  --  Vodafone Carrier Services 9

 --  Vodafone Global Enterprise (VGE) 9, 16, 20, 22

  --  Vodafone Procurement Company (VPC) 20

 - Products

  --  Business 8, 9, 16, 20, 72

  --  Call Me 71

  --  Liberty (Malta) 47

  --  One 51

  --  Please Call Me 71

  --  Red 8

  --  Small Business (UK) 21

  --  Vodafone Cloud 6, 7

  --  Vodafone TV 17, 51

 - Project Spring 49

 - Vodafone Foundation 20

Vodafone Group 54, 55, 73

 - UK 54

Z

ZTE Corp. 23, 24, 26, 72

  • Group has a second go at IT services market with cloud of clouds play.
  • IBM tie-up looks to see VCHS step back from front line of market.
  • Vodafone quiet on future for related IT infrastructure, security business, and other cloud partners.

The Group’s low-profile Vodafone Cloud & Hosted Services (VCHS) division is to undergo a major recalibration on the back of a new “strategic commercial agreement” with IBM.

The two businesses announced they are to join forces to target European enterprises with a range of digital solutions, exploiting ‘hot‘ technologies such as artificial intelligence (AI), 5G, Internet of Things, and edge computing.

Optimisation, automation, and cognitive capabilities” will be a key focus, and the relationship sees Vodafone following many of its key telco peers by veering away from direct competition with the ‘hyper‑scalers‘, and positioning itself as cloud aggregator, with IBM’s support. Vodafone stressed IBM was bringing “multi‑cloud, industry expertise, and professional services capabilities” to the table. The venture will “provide clients with the open, flexible technologies they need to integrate multiple clouds”, said Vodafone.

Ireland, Germany, and the UK will reportedly be among early target markets for the duo.

“This strategic venture with IBM allows us to focus on our strengths in fixed and mobile technologies, whilst leveraging IBM’s expertise in multi‑cloud, AI, and services.” — Nick Read, Chief Executive, Vodafone.

Fineprint not yet apparent

The tie‑up was presented as a “new venture” by IBM and Vodafone, but it is yet to become clear where it sits on the scale between a commercial alliance and fully distinct business entity. The signs point to the former, with the partnership providing cover for Vodafone itself to effectively withdraw from direct cloud market involvement over time.

Practically, the move will see IBM provide managed services to VCHS — the unit Vodafone created from cloud services assets acquired through the 2012 Cable & Wireless Worldwide acquisition — via an eight‑year deal worth “approximately $550m [£427m/EUR484m]”. Through this arrangement, VCHS will gain access to IBM’s “full portfolio of… cloud offerings”.

The “new venture” — yet to be publicly branded — will be brought into operation by 30 June 2019 (with May 2019 a reported target date), and overseen by “dedicated executive leaders from both companies”. TechCrunch reported that IBM and Vodafone employees that have been assigned to the new venture will shortly move into a new office on “neutral territory”.

Neither Vodafone nor IBM offered any detail on how revenue from the venture will be split, or the nature of its key objectives in a highly competitive marketplace where Vodafone has yet to make a major impact, despite repeatedly claiming serious ambition. Nor have the partners disclosed terms of the agreement, including any exclusivity clauses — or plans for the Vodafone Cloud infrastructure that currently supports VCHS’ offerings. These were offered across 28 markets internationally when Vodafone last provided an update, in mid‑2017.

A report by The Register painted the deal as more of an outsourcing-led retreat by Vodafone than the growth-oriented, new-wave telco-IT marriage enthusiastically put forward by the two partners.

The website claimed “up-to-750 staff” could ultimately move across from Vodafone to the new venture, and the wording of its report indicated the project will sit within IBM, rather than being led by a co‑parented new business (as the providers’ statement might lend some to think).

VCHS’ existing private cloud products will “eventually” be “given the bullet” in favour of IBM offerings, the report cited an “insider” as saying.

“Expect a very blue range of products and services in the portfolio. Vodafone’s private cloud products were tired and years behind [the market]. We figured we couldn’t catch up and needed some help. A move like this has been on the cards for a long time and is zero surprise to anyone.” — A “contact” quoted by The Register.

Big Blue on Red

The tie‑up is the latest signal that IBM — a long-time key partner of Vodafone in internal IT service provision — is gaining ground as the Group pushes a new, digitisation-infused wave of cost-cutting programmes within its business. IBM has secured a series of OpCo relationships on automation of customer support, and there have been signals the US provider has retained its position as main IT operations partner to Vodafone Idea, as it begins the Indian operator’s post-merger restructuring (see separate report).

The vendor has evidently found common ground with challenged European telcos that are being forced to refresh their IT services strategy. IBM had already flagged a tightening relationship with VCHS, announcing a hybrid cloud services link‑up with the division in September 2017 (Vodafonewatch, #159). In January 2018, IBM also flagged a tie‑up with BT Global Services, linking the IBM Cloud platform with BT’s network services, and was reported to be close to announcing a strategic partnership with Deutsche Telekom’s T‑Systems unit on mainframe operations.

BOGO with forgotten VESS?

A further question over the link‑up is whether as well as VCHS, the IBM relationship has tie‑in for Vodafone Enterprise Security Services, a “strategic services” unit added to the Vodafone Business stable (or Group Enterprise, as it was then known) in 2016 (Vodafonewatch, #143).

Like VCHS, the unit has been noticeably quiet since launch, offering no major splashes on client or partner relationships, and its leadership was melded with VCHS in 2018 (under Greg Hyttenarauch), with some top executives having departed. Vodafone’s statement on the IBM partnership suggested security is indeed a focus for the new venture, noting the “vulnerability of data” facing enterprises in the era of cloud adoption. Vodafone declined to comment on the unit’s future, when contacted.

New broom for Vodafone Business, new squeeze on partners?

The move comes with Vodafone’s new leadership team evidently seeking to breathe new life into Vodafone Business, having in 2017 hired Dell EMC executive Brad Berry to lead its change programme, as Group Enterprise Transformation Director. In December 2018, the Group re‑branded the division and asserted “renewed focus on putting customers and tangible business outcomes at its core” (Vodafonewatch, #170).

Enabling VCHS to restructure and scale, with the help of a partner, was an obvious starting point for a unit that has done little to suggest it has gained a starring role in the Vodafone firmament, or been backed with major investment from cost‑conscious Group leadership. Vodafone releases next-to-no details of VCHS’ financial performance, but pegged its revenue at just £213m (EUR241m) in the year to 31 March 2013 (FY12-13), only around 0.5% of Group turnover. It has intermittently presented growth at the unit since, including a reported 14.8%‑rise in VCHS service revenue during FY16-17, but the unit appears to remain more side‑line than central.

Partners and suppliers to Vodafone will no doubt be on watch for further opportunities and threats in relation to changes at other Vodafone Business units, including its Product Management function and commercial businesses Vodafone Carrier Services (previously mooted as a possible Group spinout), Vodafone IoT, and Vodafone Global Enterprise, with its web of commercial and technology relationships across Europe, the USA, and elsewhere.

As is apparent with the IBM switch, the Group is understood to be attempting to steer its largest suppliers into “strategic partnerships” that “share value” — offsetting outlay on technology with sell‑through and sell‑with arrangements, but offering up major vendor lock‑in considerations, too.

Image: Vodafone

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