Vodafone Group plc // is a British multinational telecommunications company headquartered in London and with its registered office in Newbury, Berkshire. It is the world's 2nd-largest mobile telecommunications company measured by both subscribers and 2013 revenues (behind China Mobile), and had 434 million subscribers as of 31 March 2014.
Vodafone owns and operates networks in 21 countries and has partner networks in over 40 additional countries. Its Vodafone Global Enterprise division provides telecommunications and IT services to corporate clients in over 65 countries.
Vodafone has a primary listing on the London Stock Exchange and is a constituent of the FTSE 100 Index. It had a market capitalisation of approximately £89.1 billion as of 6 July 2012[update], the third-largest of any company listed on the London Stock Exchange. It has a secondary listing on NASDAQ.
- 1 Name
- 2 History
- 3 Adverts
- 4 Operations
- 5 Products and services
- 6 Corporate affairs
- 7 Criticisms
- 8 Surveillance Infrastructure
- 9 References
- 10 External links
The name Vodafone comes from voice data fone, chosen by the company to "reflect the provision of voice and data services over mobile phones."
The evolution of 'Vodafone' started in 1982 with the establishment of the 'Racal Strategic Radio Ltd' subsidiary of Racal Electronics plc – UK's largest maker of military radio technology, which formed a joint venture with Millicom called 'Racal', which evolved into the present day Vodafone.
Evolution as a Racal Telecom brand: 1980 to 1991
In 1980, Sir Ernest Harrison OBE, the then chairman of Racal Electronics plc. agreed to a deal with Lord Weinstock of General Electric Company plc to allow Racal to access some of GEC's tactical battle field radio technology. The head of Racal's military radio division – Gerry Whent was briefed by Ernest Harrison to drive the company into commercial mobile radio. Whent visited GE’s mobile radio factory in Virginia, USA the same year to understand the commercial use of military radio technology.
Jan Stenbeck, head of a growing Swedish conglomerate, set up an American company, Millicom, Inc. and approached Racal’s Whent in July 1982 about bidding jointly for the UK’s second cellular radio licence. The two struck a deal giving Racal 60% of the new company, Racal-Millicom, Ltd, and Millicom 40%. Due to UK concerns about foreign ownership, the terms were revised, and in December 1982, the Racal-Milicom partnership was awarded the second UK mobile phone network license. Final ownership of Racal-Millicom, Ltd was 80% Racal, with Millicom holding 15% plus royalties and venture firm Hambros Technology Trust holding 5%. According to the UK Secretary of State for Industry, "the bid submitted by Racal-Millicom Ltd… provided the best prospect for early national coverage by cellular radio."
Vodafone was launched on 1 January 1985 under the new name, Racal-Vodafone (Holdings) Ltd, with its first office based in the Courtyard in Newbury, Berkshire, and shorty thereafter Racal Strategic Radio was renamed Racal Telecommunications Group Limited. On 29 December 1986, Racal Electronics issued shares to the minority shareholders of Vodafone worth GB£110 million; and Vodafone became a fully owned brand of Racal.
On 26 October 1988, Racal Telecom, majority held by Racal Electronics; went public on the London Stock Exchange with 20% of its stock floated. The successful flotation led to a situation where the Racal's stake in Racal Telecom was valued more than the whole of Racal Electronics. Under stock market pressure to realise full value for shareholders, Racal demerged Racal Telecom in 1991.
Vodafone Group, then Vodafone Airtouch plc: 1991 to 2000
On 16 September 1991, Racal Telecom was demerged from Racal Electronics as Vodafone Group, with Gerry Whent as its CEO.
In July 1996, Vodafone acquired the two thirds of Talkland it did not already own for £30.6 million. On 19 November 1996, in a defensive move, Vodafone purchased Peoples Phone for £77 million, a 181 store chain whose customers were overwhelmingly using Vodafone's network. In a similar move the company acquired the 80% of Astec Communications that it did not own, a service provider with 21 stores.
In January 1997, Gerald Whent retired and Christopher Gent took over as the CEO. The same year, Vodafone introduced its Speechmark logo, composed of a quotation mark in a circle, with the O's in the Vodafone logotype representing opening and closing quotation marks and suggesting conversation.
On 29 June 1999, Vodafone completed its purchase of AirTouch Communications, Inc. and changed its name to Vodafone Airtouch plc. The merged company commenced trading on 30 June 1999. In order to gain anti-trust approval for the merger, Vodafone sold its 17.2% stake in E-Plus Mobilfunk. The acquisition gave Vodafone a 35% share of Mannesmann, owner of the largest German mobile network.
On 21 September 1999, Vodafone agreed to merge its U.S. wireless assets with those of Bell Atlantic Corp to form Verizon Wireless. The merger was completed on 4 April 2000, just a few months prior to Bell Atlantic's merger with GTE to form Verizon Communications, Inc.
In November 1999, Vodafone made an unsolicited bid for Mannesmann, which was rejected. Vodafone's interest in Mannesmann had been increased by the latter purchase of Orange, the UK mobile operator. Chris Gent would later say Mannesmann's move into the UK broke a "gentleman's agreement" not to compete in each other's home territory. The hostile takeover provoked strong protest in Germany, and a "titanic struggle" which saw Mannesmann resist Vodafone's efforts. However, on 3 February 2000, the Mannesmann board agreed to an increased offer of £112 billion, then the largest corporate merger ever. The EU approved the merger in April 2000 when Vodafone agreed to divest the 'Orange' brand, which was acquired in May 2000 by France Télécom. The conglomerate was subsequently broken up and all manufacturing related operations sold off.
Vodafone Group plc: 2000 to present
On 28 July 2000, the Company reverted to its former name, Vodafone Group plc.
In 2001, the Company acquired Eircell, the largest wireless communications company in Ireland, from eircom. Eircell was subsequently rebranded as Vodafone Ireland. Vodafone then went on to acquire Japan's third-largest mobile operator J-Phone, which had introduced camera phones first in Japan.
On 17 December 2001, Vodafone introduced the concept of "Partner Networks", by signing TDC Mobil of Denmark. The new concept involved the introduction of Vodafone international services to the local market, without the need of investment by Vodafone. The concept would be used to extend the Vodafone brand and services into markets where it does not have stakes in local operators. Vodafone services would be marketed under the dual-brand scheme, where the Vodafone brand is added at the end of the local brand. (i.e., TDC Mobil-Vodafone etc.)
In 2007, Vodafone entered into a title sponsorship deal with the McLaren Formula One team, which traded as "Vodafone McLaren Mercedes" until the sponsorship ended at the end of the 2013 season.
On 1 December 2011, it acquired the Reading based Bluefish Communications Ltd – an ICT consultancy company. The acquired operations formed the nucleus of a new Unified Communications and Collaboration practice within its subsidiary – Vodafone Global Enterprise, which will focus on implementing strategies and solutions in cloud computing, and strengthen its professional services offering.
In April 2012, Vodafone announced an agreement to acquire Cable & Wireless Worldwide (CWW) for £1.04 billion. Vodafone was advised by UBS AG, while Barclays and Rothschild advised Cable & Wireless. The acquisition will give Vodafone access to CWW's fibre network for businesses, enabling it to take unified communications solutions to large enterprises in UK and globally; and expand its enterprise service offerings in emerging markets. On 18 June 2012, Cable & Wireless' shareholders voted in favour of the Vodafone offer, exceeding the 75% of shares necessary for the deal to go ahead.
Since 2010, the adverts feature two bees named Jack and Mike who are voiced by Karl Theobald and Dan Antopolski. Other adverts feature Star Wars character Yoda. Idris Elba does voice over for adverts.
Africa and the Middle East
|1Majority stakes held through majority-owned Vodacom Group
2Effective ownership is not majority, but full control exercised by the group.
In November 1998, Vodafone Egypt network went live under the name ClickGSM.
On 8 November 2006, the Company announced a deal with Telecom Egypt, resulting in further co-operation in the Egyptian market, and increasing its stake in Vodafone Egypt. After the deal, Vodafone Egypt was 55% owned by the group, while the remaining 45% was owned by Telecom Egypt.
On 28 January 2011, Vodafone complied with Egyptian government instructions to suspend Internet service "in selected areas" during a period of anti-Mubarak protests. The company issued a statement that "Under Egyptian legislation, the authorities have the right to issue such an order and we are obliged to comply with it."
Vodafone also received public and media criticism for allowing the authorities to send mass pro-government messages via SMS over their network during the protests. One such message requested that "honest and loyal men" should "confront the traitors and criminals". Vodafone later issued a statement asserting that they had no choice but to allow the messages to be broadcast, and that they had complained to the Egyptian authorities about the practice.
On 18 September 2002, Vodafone signed a Partner Network Agreement with MTC group of Kuwait. The agreement involved the rebranding of MTC to MTC-Vodafone. On 29 December 2003, Vodafone signed another Partner Network Agreement with Kuwait's MTC group. The second agreement involved co-operation in Bahrain and the branding of the network as MTC-Vodafone.
- South Africa (Vodacom)
On 3 November 2004, the Company announced that its South African affiliate Vodacom had agreed to introduce Vodafone's international services, such as Vodafone live! and partner agreements, to its local market.
In November 2005, Vodafone announced that it was in exclusive talks to buy a 15% stake of VenFin in Vodacom Group, reaching agreement the following day. Vodafone and Telkom then had a 50% stake each in Vodacom. Vodafone now owns 57.5% of Vodacom after purchasing a 15% stake from Telkom.
On 9 October 2008, the company offered to acquire an additional 15 per cent stake in Vodacom group from Telkom. The finalised details of the agreement were announced on 6 November 2008. The agreement called for Telkom to sell 15 per cent of its 50 per cent stake in Vodacom to the group, and demerge the other 35 per cent to its shareholder. Meanwhile, Vodafone has agreed to make Vodacom its exclusive sub-Saharan Africa investment vehicle, as well as continuing to maintain the visibility of the Vodacom brand. The transaction is closed in May/June 2009.
On 18 May 2009, Vodacom entered the JSE Limited stock exchange in South Africa after Vodafone increased its stake by 15% to 65% to take a majority holding, despite disputes by local trade unions.
In April 2011, Vodacom, rebranded themselves with the Vodafone logo.
In December 2007, a Vodafone Group-led consortium was awarded the second mobile phone licence in Qatar under the name "Vodafone Qatar". Vodafone Qatar is located at QSTP, the Qatar Science & Technology Park
On 3 July 2008, Vodafone agreed to acquire a 70% stake in Ghana Telecom for $900 million. The acquisition was consummated on 17 August 2008. The same group-led consortium won the second fixed-line licence in Qatar on 15 September 2008.
On 15 April 2009, Ghana Telecom, along with its mobile subsidiary OneTouch, was rebranded as Vodafone Ghana.
On 28 January 2009, the group announced a partner network agreement with Du, the second-largest operator of the United Arab Emirates. The agreement involved co-operation on international clients, handset procurement, mobile broadband etc.
On 24 February 2010, the group signed a partner network agreement with the second-largest operator in Libya, al Madar.
- United States
In the United States, Vodafone previously owned 45% of Verizon Wireless in a joint venture with Verizon Communications,[dated info] the country's largest mobile carrier. However the Vodafone branding was not used, as the CDMA network was not compatible with the GSM 900/1800 MHz standard used by Vodafone's other networks and as Vodafone did not have management control over Verizon Wireless, on 2 September 2013 Vodafone announced the sale of its stake to Verizon Communications for around $130 billion.
In 2004 Vodafone made an unsuccessful bid for the entirety of AT&T Wireless, however, (Cingular Wireless) at the time a joint venture of SBC Communications and BellSouth (both now part of AT&T Inc.), ultimately outbid Vodafone and took control of AT&T Wireless (the combined wireless carrier is now AT&T Mobility).
In December 2014, Vodafone announced an agreement with T-Mobile US to launch a MVNO service using its network, set to launch in 2015.
On 11 May 2008, Vodafone sealed a trade agreement with the Chilean Entel PCS Chile, in which Entel PCS has access to the equipment and international services of Vodafone, and Vodafone will be one of the trademarks of Entel for the wireless business. This step will give the Vodafone brand access to a market of over 15 million people, currently divided among two companies: Telefonica Movistar, and Entel PCS.
On August 2013, Vodafone has started the MVNO operation in Brazil, as a corporative M2M operator.
In July 1993, BellSouth New Zealand's network went live, and October 1993 Vodafone Australia's network also went live. This was followed in July 1994 by Vodafone Fiji's network going live. In November 1998, Vodafone purchased BellSouth New Zealand, which later became Vodafone New Zealand.
In 1999, J-Phone launched the J-sky mobile internet service in response to DoCoMo's i-Mode service. In December 2002 J-Phone's 3G network went live. On 1 October 2003, J-Phone became 'Vodafone Japan', and J-Phone's mobile internet service J-Sky became Vodafone Live!. In March 2006, Vodafone sold Vodafone Japan to SoftBank. In October 2006, SoftBank changed Vodafone Japan's name to 'SoftBank Mobile'.
On 3 November 2003, Singapore became a part of the community as M1 was signed as partner network.
Then in April 2005, SmarTone changed the name of its brand to 'SmarTone-Vodafone', after both companies signed a Partner Network Agreement. In August 2005, Vodafone launched 3G technology in New Zealand, and in October 2005, it began launching 3G technology in Australia. On 28 October 2005, the Company announced the acquisition of a 10 per cent stake in India's Bharti Enterprises, which operates the largest mobile phone network in India under the brand name airtel. On 22 December 2005, the Company announced the completion of the acquisition of the 10% stake in Bharti Enterprises of India.
In January 2006, Indonesia, Malaysia, and Sri Lanka were added to the Vodafone footprint as Vodafone Group signed a partner network agreement with Telekom Malaysia. On 17 March 2006, Vodafone announced an agreement to sell all its interest in Vodafone Japan to SoftBank for £8.9 billion, of which £6.8 billion will be received in cash on closing of deal. Vodafone Japan later changed its name to SoftBank Mobile. In November 2010, Vodafone divested its remaining Softbank shares. On 9 October 2006, Vodafone New Zealand bought New Zealand's 3rd largest internet service provider, iHug, and on 1 November 2006, Vodafone Australia signed the Australian Football League (AFL)'s biggest individual club sponsorship deal with the Brisbane Lions for seasons 2007, 2008 and 2009.
On 6 February 2007, along with the partnership with Digicel Caribbean (see below), Samoa was added as a Partner Market. Then on 11 February 2007, the Company agreed to acquire a controlling interest of 67% in Hutch Essar for US$11.1 billion. At the same time, it agreed to sell back 5.6% of its airtel stake back to the Mittals. Vodafone would retain a 4.4% stake in airtel. On 21 September 2007, Hutch was rebranded to Vodafone in India.
On 6 February 2007, Vodafone Group signed a three-year partnership agreement with Digicel Group. The agreement, which includes Digicel's sister operation in Samoa, will result to the offering of new roaming capabilities. The two groups will also become preferred roaming partners of each other. Along with Digicel's markets, the Vodafone brand is now present in 81 countries, regions, and territories. What is interesting to note, is that as well as being partners, Digicel and Vodafone are also rival operators in Fiji, where Digicel Fiji recently launched in October 2008, and Vodafone owns a minority (49%) stake in Vodafone Fiji.
On 10 February 2008, Vodafone announced the launching of M-Paisa mobile money transfer service on Roshan's (Afghanistan's largest GSM operator) network: Afghanistan was added to the Vodafone footprint.
On 9 February 2009, Vodafone Australia announced a merger with 3/Hutchison via a joint venture company VHA Pty Ltd, which would offer products under the Vodafone brand. dtac in Thailand is signed as a partner network of the Group on 25 March 2009.
On 19 June 2009, Vodafone-Hutchison Australia (VHA) announced the end of its outsourcing of retail operations. VHA committed to buying back and managing its entire retail operation, including 208 Vodafone-branded retail outlets Australia-wide. This project was slated to be completed by 1 September 2009.
On 31 August 2009, VHA enabled an extended 900 MHz 3G UMTS network which functions outside their 2,100 MHz 3G network, boosting Vodafone's 3G population coverage from around 8% to around 94% on dual-band 900/2,100 MHz 3G UMTS devices.
In October 2013, it was reported by Reuters that Vodafone planned to invest as much as $2 billion (£1.2 billion) to buy out minority shareholders in Vodafone India.
|Czech Republic||Bulgaria||Channel Islands|
Vodafone Hungary is a subsidiary of Vodafone Global mobile telephone company operating in Hungary, the company started to operate in 7 July 1999. In February 2002, Radiolinja of Finland joined as a Partner Network. Radiolinja later changed its named to Elisa. Later that year, the Company rebranded Japan's J-sky mobile internet service as Vodafone live!, and on 3 December 2002, the Vodafone brand was introduced in the Estonian market following the signing of a Partner Network Agreement with Radiolinja (Eesti). Radiolinja (Eesti) later changed its name to Elisa.
On 7 January 2003, the Company signed a group-wide Partner agreement with mobilkom Austria. As a result, Austria, Bulgaria, Croatia and Slovenia were added to the community. In April 2003, Og Vodafone was introduced in the Icelandic market, and in May 2003, Omnitel (Omnitel Pronto-Italia) was rebranded Vodafone Italy. On 21 July 2003, Lithuania was added to the community, with the signing of a Partner Network agreement with Bitė.
In February 2004, Vodafone signed a Partner Network Agreement with Luxembourg's LuxGSM, and a Partner Network Agreement with Cyta of Cyprus. Cyta agreed to rename its mobile phone operations to Cytamobile-Vodafone. In April 2004, the Company purchased Singlepoint airtime provider from John Caudwell (Caudwell Group), and approx 1.5 million customers onto its base for £405million, adding sites in Stoke-on-Trent (England), to existing sites in Newbury (HQ), Birmingham, Warrington and Banbury. In November 2004, Vodafone introduced 3G services into Europe.
In June 2005, the Company increased its participation in Romania's Connex to 99%, and also bought the Czech mobile operator Oskar. On 1 July 2005, Oskar of the Czech Republic was rebranded as Oskar-Vodafone. Later that year, on 17 October 2005, Vodafone Portugal launched a revised logo, using new text designed by Dalton Maag, and a 3D version of the Speechmark logo, but still retaining a red background and white writing (or vice versa). Also, various operating companies started to drop the use of the SIM card pattern in the company logo. (The rebranding of Oskar-Vodafone and Connex-Vodafone also does not use the SIM card pattern.) A custom typeface by Dalton Maag (based on their font family InterFace) formed part of the new identity.
On 28 October 2005, Connex in Romania was rebranded as Connex-Vodafone, and on 31 October 2005, the Company reached an agreement to sell Vodafone Sweden to Telenor for approximately €1 billion. After the sale, Vodafone Sweden became a Partner Network. In December 2005, Vodafone won an auction to buy Turkey's second-largest mobile phone company, Telsim, for US$4.5 billion. In December 2005, Vodafone Spain became the second member of the Group to adopt the revised logo: it was phased in over the following six months in other countries.
In 2006, the Company rebranded its Stoke-on-Trent site as Stoke Premier Centre, a centre of expertise for the company dealing with Customer Care for its higher value customers, technical support, sales and credit control. All cancellations and upgrades started to be dealt with by this call centre. On 5 January 2006, Vodafone announced the completion of the sale of Vodafone Sweden to Telenor. On February 2006, the Company closed its Birmingham Call Centre. On 1 February 2006, Oskar Vodafone became Vodafone Czech Republic, adopting the revised logo, and on 22 February 2006, the Company announced that it was extending its footprint to Bulgaria with the signing of Partner Network Agreement with Mobiltel, which is part of mobilkom Austria group.
In April 2006, the Company announced that it had signed an extension to its Partner Network Agreement with BITE Group, enabling its Latvian subsidiary "BITE Latvija" to become the latest member of Vodafone's global partner community. Also in April 2006, Vodafone Sweden changed its name to Telenor Sverige AB, and Connex-Vodafone became Vodafone Romania, also adopting the new logo. On 30 May 2006, Vodafone announced the then biggest loss in British corporate history (£14.9 billion), and plans to cut 400 jobs; it reported one-off costs of £23.5 billion due to the revaluation of its Mannesmann subsidiary. On 24 July 2006, the respected head of Vodafone Europe, Bill Morrow, quit unexpectedly, and on 25 August 2006, the Company announced the sale of its 25% stake in Belgium's Proximus for €2 billion. After the deal, Proximus was still part of the community as a Partner Network. On 5 October 2006, Vodafone announced the first single brand partnership with Og Vodafone which would operate under the name Vodafone Iceland, and on 19 December 2006, the Company announced the sale of its 25% stake in Switzerland's Swisscom for CHF4.25 billion (£1.8 billion)., After the deal, Swisscom would still be part of the community as a Partner Network. Finally in December 2006, the Company completed the acquisition of Aspective, an enterprise applications systems integrator in the UK, signalling Vodafone's intent to grow a significant presence and revenues in the information and communication technologies (ICT) marketplace.
Early in January 2007, Telsim in Turkey adopted Vodafone dual branding as Telsim Vodafone, and on 1 April 2007, Telsim Vodafone Turkey dropped its original brand and became Vodafone Turkey. In addition, Vodafone Turkey also gives service in Northern Cyprus. On 1 May 2007, Vodafone added Jersey and Guernsey to the community, as Airtel was signed as Partner Network in both crown dependencies. In June 2007, the Vodafone live! mobile internet portal in the UK was relaunched. Front page was now charged for, and previously "bundled" data allowance was removed from existing contract terms. All users were given access to the "full" web rather than a 'Walled Garden', and Vodafone became the first mobile network to focus an entire media campaign on its newly launched mobile internet portal in the UK. On 1 August 2007, Vodafone Portugal launched Vodafone Messenger, a service with Windows Live Messenger and Yahoo! Messenger. At the end of 2007, Vodafone Germany was ranked 6th in Europe by subscriber numbers, whilst its Italian operation was listed as 10th. Vodafone UK was ranked 13th, whilst Spain was listed in 16th place.
On 17 April 2008, Vodafone extended its footprint to Serbia as Vip mobile was added to the community as a Partner Network, and on 20 May 2008, the Company added VIP Operator as a Partner Network, thereby extending the global footprint to the Republic of Macedonia. In May 2008, Kall of the Faroe Islands rebranded as Vodafone Faroe Islands.
On 30 October 2008, the company announced a strategic, non-equity partnership with Mobile TeleSystems (MTS) group of Russia. The agreement adds Russia, Armenia, Turkmenistan, Ukraine, and Uzbekistan to the group footprint.
On 20 March 2009, it was announced that the group's Luxembourg partner has been changed to Tango: the agreement with LuxGSM was not renewed in favour of Tango, the Luxembourg unit of another partner network, Belgacom of Belgium.
In March 2013, the Spanish operations of Vodafone signed an agreement with Orange S.A. to co-invest €1 billion in the expansion of Spain's fibre-optic cable broadband network. This will enable Vodafone to reach an additional 6 million customers in Spain by 2017.
Vodafone Global Enterprise
Vodafone Global Enterprise is the business services division, and a wholly owned subsidiary of Vodafone Group. It was established in April 2007 to provide telecommunications and information technology services to large corporations.
It offers integrated communication solutions in cloud computing, unified communications and collaboration. Its services include domestic and international voice and data, Machine to Machine services, mobile email, mobile broadband, managed services, mobile payment and mobile recording.
In December 2011, it acquired the Reading-based Bluefish Communications Ltd – an ICT consultancy company. The acquired operations will form the nucleus of a new Unified Communications and Collaboration practice within VGE, which will focus on implementing strategies and solutions in cloud computing, and strengthen its professional services offering.
It operates in over 65 countries, operated by its "Northern Europe" (based in London, United Kingdom), "Central Europe", "Southern Europe and Africa", "Asia Pacific & Sub-Saharan Africa" (based in Singapore) and "Americas" geographical divisions. VGE's major customers include Deutsche Post, The Linde Group, Unilever, and Volkswagen Group.
Products and services
Products promoted by the Group include Vodafone live!, Vodafone Mobile Connect USB Modem, Vodafone Connect to Friends, Vodafone Eurotraveller, Vodafone Freedom Packs, Vodafone 710 and Amobee Media Systems.
In October 2009, it launched Vodafone 360, a new internet service for the mobile, PC and Mac. This was discontinued in December 2011 after disappointing hardware sales. This was after The Director of Internet Services resigned in September 2010 tweeting "5 days before I leave Vodafone. Freedom beckons." In February 2010, Vodafone launched world's cheapest mobile phone known as Vodafone 150, will sell for below $15 (£10) and is aimed at the developing world. It will initially be launched in India, Turkey and eight African countries including Lesotho, Kenya and Ghana.
Mobile money transfer services
In March 2007, Safaricom, which is part owned by Vodafone and the leading mobile communication provider in Kenya, launched a mobile payment solution developed by Vodafone. M-PESA is aimed at mobile customers who do not have a bank account, typically because they do not have access to a bank or their income is insufficient to justify a bank account. The M-PESA system allows customers to deposit and withdraw cash via local agents, and transfer money to other mobile phone users via SMS.
By February 2008, the M-PESA money transfer system in Kenya had gained 1.6 million customers. By 2011 there were fourteen million M-Pesa accounts by which held 40 percent of the country’s savings. Following M-PESA’s success in Kenya, Vodafone announced that it was to extend the service to Afghanistan. The service here was launched on the Roshan network under the brand M-Paisa with a different focus to the Kenyan service. M-Paisa was targeted as a vehicle for microfinance institutions' (MFI) loan disbursements and repayments, alongside business to business applications such as salary disbursement. The Afghanistan launch was followed in April 2008 by the announcement of further a further launch of M-PESA in Tanzania, South Africa and India.
In February 2012, Vodafone announced a worldwide partnership with Visa. To introduce a Vodafone Mobile Wallet, initially in Germany, The Netherlands, Spain, Turkey and the UK. "The Vodafone mobile wallet represents the next stage of the smartphone revolution," says Vittorio Colao, Vodafone's group CEO. This will enable Vodafone subscribers to pay for goods and services using their mobile phones instead of coins and banknotes.
In November 2009, Vodafone announced the creation of a new business unit focused on the emerging mHealth market (the application of mobile communications and network technologies to healthcare). One of its early success stories is with the Novartis-led "SMS for Life" project in Tanzania, for which Vodafone developed and deployed a text-message based system that enables all of the country’s 4,600 public health facilities to report their levels of anti-malarial medications so that stock level data can be viewed centrally in real-time, enabling timely re-supply of stock. During the SMS for Life pilot, which covered 129 health facilities over six months, stock-outs dropped from 26% to 0.8%, saving thousands of lives.
Vodafone has also been active in mHealth from a philanthropic perspective. The Vodafone Group Foundation is a founder member of the mHealth Alliance, supporting the adoption of mHealth through policy research and advocacy and the development of interoperable and sustainable mHealth solutions.
Vodafone is a strategic partner with several mHealth companies including Numera/BlueLibris and Medopad. Medopad was showcased in the Vodafone Pavilion at CeBIT Global Conferences in March 2014 in Germany.
The Vodafone Foundation is a recognised charity which supports and initiates projects which use mobile technology to benefit the vulnerable. It is described by Vodafone as ‘Mobile for Good’; using mobile technology to support good causes. They often work in collaboration with other charitable groups. Below are some examples of their initiatives:
- TECSOS – mobile phones have been adapted to allow victims of domestic violence to activate immediate contact with the emergency services if they are in danger
- Paediatric Epilepsy Remote Monitoring System – a monitoring system that allows physicians to remotely make patient observations
- Safe Taxi System – an initiative in Portugal that consists of technology that taxi drivers can use to alert police if they are in danger of being assaulted
- Learning with Vodafone Solution – technology that allows teachers in India to use graphical and multi-media content to enhance their teaching
- The World of Difference UK programme - successful applicants choose charities for which they work either full-time for two months or part-time for four months (minimum 15 hours a week). The charities are provided with £2,500, with each winner receiving the balance as a salary after NI and tax have been paid.
In a period just short of twenty years from its initial public offering, the Company had had just three Chief Executives. The fourth CEO, Vittorio Colao, stepped up from Deputy Chief Executive in July 2008. Each of his predecessors made a personal contribution to the development of the Company.
Sir Gerald Whent, at that time an Executive with Racal Electronics plc, was responsible for the bid for a UK Cellular Network licence. The Mobile Telecoms division was de-merged, and was floated on the London Stock Exchange in October 1988 and Sir Gerald became Chief Executive of Racal Telecom plc. Over the next few years the company grew to become the UK's Market Leader, changing its name to Vodafone Group plc in the process.
Sir Christopher Gent took over as Chief Executive in January 1997, after Sir Gerald's retirement. Sir Christopher was responsible for transforming Vodafone from a small UK operator into the global behemoth that it is today, through the merger with the American AirTouch and the takeover of Germany's Mannesmann, the Goldman Sachs chief advisor on the deal was Scott Mead.
Arun Sarin was the driving force behind the Company's move into emerging markets such as Asia and Africa, through the purchases such as that of Turkish operator Telsim, and a majority stake in Hutchison Essar in India. Faced with increased competition, and penetration rates above 100% in the more mature European markets, he saw it necessary to diversify from being a mobile-only business into a company which provided all telecommunications services. This has seen Vodafone launch DSL and other fixed-line services in markets such as Germany and the UK.
|Sir Gerald Whent||October 1988 – December 1996|
|Sir Christopher Gent||January 1997 – July 2003|
|Arun Sarin||July 2003 – July 2008|
|Vittorio Colao||Since July 2008|
Vodafone reports its results in accordance with International Financial Reporting Standards (IFRS).
Vodafone has some large minority stakes, which are not included in its consolidated turnover. In order to provide additional information on the overall scale and growth trends of its business, it publishes "proportionate turnover" figures, and these are included in the tables below. For example, if a business in which it owns a 45% stake has turnover of £10 billion, that equals £4.5 billion of proportionate turnover for Vodafone. Proportionate turnover is not an official accounting measure, and Vodafone's proportionate turnover should not be compared with other companies' statutory turnover.
Vodafone also produces proportionate customer number figures on a similar basis, e.g. if an operator in which it has a 30% stake has 10 million customers that equals 3 million proportionate Vodafone customers.
|Year ended 31 March||Turnover £m||Profit before tax £m||Profit for the year £m||Basic eps (pence)||Proportionate customers (m)|
*Losses for year to 31 March 2006 reflect write downs of assets, principally in relation to the Mannesmann acquisition. Proportionate turnover includes £7,100 million from discontinued operations.
In September 2010, an investigation by Private Eye magazine revealed certain details of Vodafone's tax avoidance activities. It was reported that Vodafone routed the acquisition of Mannesmann through a Luxembourg subsidiary, set up to avoid paying tax on the deal, and continued to place its profits in Luxembourg. Following a long legal struggle with HMRC (during which a senior HMRC official, John Connors, switched sides to become head of tax at Vodafone), it was eventually agreed that Vodafone would pay £1.25 billion related to the acquisition. Based on Vodafone's accounts, experts have estimated the potential tax bill written off as a result of the negotiations was over £6 billion.
The news of this legal tax avoidance sparked angry protests, beginning in October 2010 and ongoing as of April 2011, outside Vodafone shops across the UK, organised under the banner of UK Uncut. The first protests caused the simultaneous closure of over a dozen stores, including the flagship Oxford Street branch.
In 2011, Private Eye magazine and The Bureau of Investigative Journalism alleged that Vodafone's Swiss branches were run by a single part-time bookkeeper. The report claimed hardly any business was done from there, indicating that the main purpose of the Zug office was tax avoidance. The report claimed the money was borrowed from the Swiss branch of the Luxembourg company, allowing it to take advantage of Luxembourg’s laws, which exempts foreign branches of companies from tax, and Swiss laws, which almost completely exempt local branches of foreign companies. According to the expose, this would have otherwise generated a British tax bill on a little over £2 billion. It said Vodafone publishes a single, combined set of accounts for its Luxembourg subsidiaries and their Swiss branches. For the one company, profits worth £1.6 billion were taxed at less than one per cent in 2011, and the profits are likely to have been attributed to Switzerland. In its response to these allegations, Vodafone has said the Swiss branch has not been involved in Vodafone’s global financing for a number of years. It is, therefore, irrelevant in respect to global financing arrangements.
Vodafone was also assessed a US$2.5 billion tax over its acquisition of Hutchison Whampoa's Indian assets in 2007, a demand that it contests. In a recent event dated 20 January 2012, the highest Indian court ruled that Vodafone is not liable for taxes and penalties of up to $4.4 billion (£2.8 billion).
Vodafone was implicated in the violent suppression of pro-democracy protests in Egypt's 2011 demonstrations. On 27 January, Vodafone, responsible for much of Egypt's telecommunication infrastructure, shut off all voice and data services for Egyptian citizens and businesses at the request of the Egyptian Government under Hosni Mubarak. The Daily Telegraph of the UK reported, "The Egyptian government’s action is unprecedented in the history of the internet." U.S.-based Internet intelligence firm Renesys stated, "in an action unprecedented in Internet history, the Egyptian government appears to have ordered service providers to shut down all international connections to the Internet." Vodafone Group CEO Vittorio Colao said the company was obliged by law to comply with the instructions of the Egyptian government. In the company’s annual general meeting, on 26 June, the campaign groups Access and FairPensions asked Vodafone to endorse a plan to prevent facing similar demands in the future.
In Australia, particularly towards the end of 2010, Vodafone have been heavily criticised due to allegations of poor customer service and severe technical inadequacies, which earned them their nickname "Vodafail" – a website of the same name still exists. In response, they have developed a "new" network, and now provide a 30-day satisfaction guarantee.
Vodafone UK, like many other operators, has been criticised for holding customers on regular monthly billed contracts liable for almost unlimited roaming costs when their phones are stolen abroad, despite being seemingly able to terminate costs of pay as you go contracts without issue.
In June 2014 Vodafone revealed information about theirs and other telecommunication operators' 'direct access systems', content data and metadata interception programmes globally.
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