…We are just little old Vodafone and we stand alone
If the Telefonica acquisition of O2 goes ahead then three of the UK’s five network operators will be owned by the incumbent operators from France, Germany and Spain.
Is there another major market in Europe which can field such formidable competitors for a solitary home player such as Vodafone faces? It would beg the question, if 3 UK does go for an IPO, as has been suggested, how long the company would remain public before one of the big incumbents (TIM?) came in for it. That would leave Vodafone facing a remarkable situation, which we can’t think is mirrored in many other markets. Of course, Vodafone itself is often the “outside” presence in many markets, challenging the “home” operator.
So there are good reasons why the tier one operators might all want a slice of the UK action. First off, of course, is simply that it is a large market and lucrative market. Second, it keeps Vodafone honest in its own back yard, as the UK operator takes on each of the European incumbents in their home markets. Third, the size of the market helps add scale to an operation. Fourth, and without trying to be too parochial, the UK is undoubtedly a hub for music and digital content production, and being close to that market helps large group operators formulate content strategies.
But given the fact that one UK broadcaster was analysing this acquisition in terms of “The Germans” and “The Spanish”, will the British public be persuaded by a “buy British” campaign from Vodafone? After all, it worked wonders for the British car industry…er, ah.
… Mobile operator? Not us, we’re all media companies now
There’s so much going on this month that even our news in brief column on page six contains some pretty important news. First off, look at the announcements from T-Mobile, one on its “open garden” internet policy, and the other on the use of the TD-CDMA. The first announcement interests us because of the operator’s cto comments that to do this they had to change “the phone, the browsers, the interface, the software, the network strategy, the customer service and the tariffs.” Wow. That’s quite an admission, given that you’d have been hard pushed to extract from T –Mobile, before the service launch, the admission that everything about its operations were geared towards a closed-garden approach. The second announcment sees T-Mobile describe itself as the leading communications provider in the Czech Republic, and makes no distinction between fixed, mobile or otherwise. Indeed, with IP Wireless’ TDD service it is gunning directly for the fixed providers.
Back in the UK, there are internet based service launches from O2 (i-mode), and 3, whose ceo Bob Fuller took the opportunity to brand the operator as a media company, rather than a boring old provider of boring old telephony. By the way, lest we all get too excited, although 3 was willing to share the news that its non-voice revenues were now at 25% of its total income, it wouldn’t say how much of that is from SMS. Nor has it escaped us that that is not a much higher number than O2’s non-data share. And O2 is way behind on 3G promotion. Finally, TV. Operators are falling over themselves to offer TV content, seeing it as a nice differentiator for 3G. But with Nokia’s first integrated phone with a DVB-H receiver, are “streamed” services going to catch the consumer interest as much as watching “real” digital TV via an integrated receiver in the handset? Mr Fuller?