At least it was expected, and therefore didn’t spook the markets, but Vodafone this morningreported a 3.5% decline in organic revenues in Q2. The main culprit was its main trading area – Europe. Revenues in Spain crashed 10.6% and an even worse 17.6% in Italy. Even Germany declined 5.1% which puts the 4.5% decline in its biggest market – UK – into positive context.
Vodafone did enjoy a 13.8% rise in revenues from India. But even here intense price competition is the order of the day.
Vodafone has to avoid becoming a utility where the only differentiator is price. As their market moves from voice to ‘all you can eat’ data plans, they risk having to invest heavily in infrastructure to support increased usage at the same time as prices fall in a saturated market.
Must say that Vodafone still has the edge for me. It’s one of the only service providers that I can get in my house here in Farnham. Indeed wherever I go in the UK or abroad, it is extremely rare not to get some kind of Vodafone coverage (albeit very slow) That is more than I can say for many of my travelling companions on other networks. Personally I value ‘ubiquitous coverage’ more highly than raw speed that can only be accessed on Waterloo Station!