Mobile giant Vodafone could crash and burn as it is outpaced by rivals and it struggles to adapt to fast-moving new UK markets, says Reuters.
Analysis by the wire press service suggests Vodafone has failed to capitalise on its immense size by lacking mobile innovation.
Despite a customer base of almost 500 million worldwide, Reuters say Vodafone “risks being left on the sidelines” as it “fails to break free from just selling ever-cheaper data” and its closest rivals jump ahead by offering bundled broadband, TV and phone deals.
The latest Ofcom report found Vodafone sorely lacking in customer service, with a whopping 92 out of every 100,000 users reporting complaints with the mobile operator. By contrast, the best-rated provider, Tesco Mobile, had just three complaints per 100,000 customers.
It's fair to say Vodafone were too slow to appreciate the direction that the market was going in terms of the need to be able to offer genuinely converged products, and to have favorable access to fixed-line networks and, ideally, to own those networks.- Unnamed Vodafone Shareholder (Reuters)
On the business side, Vodafone shares are trading at a discount for the first time in three years.
Vodafone’s rivals BT have expanded their early offering from landline phones to broadband and SIM-only products.
Through BT Sport they have also built up a multi-billion pound market in Champions League football and other live sports.
Virgin Media, which was taken over American giant Liberty Global in 2013, have their own cable network and don’t need to piggyback on Openreach to offer new products.
But while others innovate to break into new areas, Vodafone shelved its long-delayed pay TV launch in February 2017 to get a grip on its already-established products.
And while Vodafone is building its own fibre broadband networks in Spain, Italy and Portugal, it has not invested in the same infrastructure in the UK.
The latest figures show Vodafone have around 130,000 broadband customers in the UK.
While demand for Vodafone’s 4G data and broadband in Europe makes it the continent’s fastest growing operator, the UK market is more uncertain.
A takeover bid looks increasingly likely as Vodafone told investors that UK revenue fell by 3.2 per cent in the year to 31 March.
Reuters add: “If Vodafone misses out, a company that has shaped the mobile industry since its launch in 1991 to become the second biggest in the world could end up being dismantled by more fleet-footed multimedia rivals.”