Vodafone Accelerates Cable&Wireless Worldwide Integration

Gary Barton

Gary Barton

Summary Bullets:

  • Faster integration will deliver quicker synergies for Vodafone and allow it to develop converged fixed and mobile services faster.
  • This is a sudden change in strategy from Vodafone’s initial slow integration approach and the MNO’s plans are ambitious.

Vodafone has set out a strategy for its enterprise facing divisions that will take it through until 2015. Effective January 1st, 2013, will launch a new ‘Group Enterprise’ umbrella (GEU) consisting of four units: Vodafone Global Enterprise (VGE); Vodafone Carrier Services, Machine-to-Machine (M2M); and Hosting and Cloud Services. Vodafone’s new strategy also involves an accelerated integration schedule for Cable&Wireless Worldwide (CWW). From the start of 2013, Vodafone will begin to integrate CWW’s UK operations with Vodafone UK – including customer service; CWW’s international business, carrier services, hosting and cloud business with the new GEU; CWW’s HR, finance and legal services will be merged with Vodafone UK and CWW’s technology division will be merged with Vodafone’s Group Technology.

A faster integration will help Vodafone realise synergies more quickly, and the GBP 500 million investment that Vodafone has earmarked for upgrading CWW’s network can go ahead with Vodafone’s operating methodology from the outset. Vodafone believes the faster integration will help it meet real client demands for integrated fixed and mobile solutions. However, combining a traditional fixed-line player with a mobile entity does not always result in a strong FMC strategy. There has to be a strong and well-managed execution. Having said that, we do agree that CWW’s expertise in selling and managing IP telephony solutions for MNCs will help Vodafone to build on its already strong portfolio of ‘Vodafone One’ FMC and UC services.

However, the new integration timeline looks tight – unifying the IT stack and systems is always a major headache that often takes far longer than was originally anticipated. Absorbing the CWW portfolio, customers and staff into Vodafone UK and the new Group Enterprise unit during 2013 is ambitious given Vodafone’s lack of experience of delivering managed network and IT services for MNCs compared with some long-established rivals. Customers are within their rights to question Vodafone about the reason for what might seem an inconsistent policy and the potential disruption it may cause. There is plenty of room for optimism, as Vodafone has demonstrated its willingness to invest and build its enterprise communications strategy and is starting with some great credentials with the momentum of VGE and CWW’s experience in fixed line voice and data network services.

About Gary Barton
As an analyst on the Current Analysis Business Network and IT Services team, Gary covers Business Telecoms Services for the UK and Ireland, with a particular interest in SME and public sector services. Gary’s responsibilities include updating and maintaining Current Analysis’s competitor assessments for the major telecoms companies operating in the UK and on a Pan-European basis.

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