“Vodafone’s announcement of its 4G launch is remarkable in what it has focused on: the tariff and content deals rather than speed and coverage.” This is according to Emeka Obiodu, principal telco strategy analyst at Ovum.
He continues: “While the presumed emphasis on 4G has always been on coverage and network speeds, Vodafone has opted to focus on the content deals and tariff options behind its offer. In a way, this undersells Vodafone’s strength given its 800MHz spectrum holdings and the improved in-door coverage this band offers. Instead, we sense that Vodafone wants to avoid the 3G lesson where it worked so hard to create the best 3G network, yet lost out as rivals, especially O2, delivered a better appealing proposition to customers.
“So this time, Vodafone is focusing on getting the commercial proposition right. We expect the deals with Spotify and Sky Sports to appeal to a lot of customers, although the downside is that Vodafone might have been forced to rush out the announcement, when it has covered only few cities, so as to sync with the start of the Premier League.
“Ultimately, this focus on business model innovation – tariff (including doubling the data package) and the content deals – is a more assured way of convincing customers to spend the additional £5/month. And Vodafone will be hoping to use 4G to prop up its ARPU as the likes of Verizon Wireless have done using business model changes – shared data plans.”
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