Vodafone – Riding its Competitive Advantage to Expand in Adjacent Markets

ITCB-HarishTaoriSummary Bullets:

  • In its annual global analyst event, Vodafone emphasized its evolution as a global “Total Communications” service provider.
  • Planned new investments, under Project Spring, to enhance the network (NFV, SDN) and solutions (M2M, Cloud connect, UCaaS) capabilities globally.

Vodafone hosted its annual global analyst event this year in London. This blog post summarizes some of the key takeaways from that event, and analyzes the implications on industry and enterprises.

  • The key theme was Vodafone’s strategy to become a global total communications service provider. Vodafone is making concerted efforts to enable this strategy by expanding global network (fixed and mobile) reach and related communication services (cloud, mobility unified collaboration, and M2M) portfolios.
  • Vodafone has deep network reach in 60 countries with 211 fixed PoPs in 161 cities. In AMEA, Vodafone has recently added new PoPs in Philippines, Taiwan and 22 African countries expanding its network presence in 14 Asia-Pacific, three Middle East and 24 African countries. Vodafone intends to expand its global coverage to 92 countries by end of 2016. Under Project Spring, Vodafone commits to invest GBP 500 million in five years to scale up its network and solution capabilities, people and offices across Asia and Africa
  • Vodafone has witnessed good momentum in its M2M portfolio, especially from automotive, consumer electronics and utilities verticals. The acquisition of Cobra consolidated Vodafone’s position in automotive, as Cobra’s clientele includes Porsche, Ferrari, Renault, and Toyota. Furthermore, Cobra enables Vodafone to provide solutions for embedded and aftermarket automotive opportunities in 41 markets as well as in fleet management for rental, leasing, and sharing of cars.
  • Vodafone reiterated its competitive advantage in mobile networks. Leveraging its core capabilities, Vodafone is offering comprehensive enterprise mobility solutions. Vodafone is further extending its service portfolio in adjacent businesses – cloud and hosting, unified communications and collaboration. Currently these services are available in US and Europe and expected to come in AMEA by next year.
  • Vodafone Global Enterprise (VGE) is targeting 1,700 global MNCs. Its key value proposition for these customers is a consistent global SLA across Vodafone and partner networks. ‘Mobile First’ people and process initiatives are key themes among VGE customers. Vodafone has also created a business unit to target SMEs. SME products and solutions are expected to roll out in AMEA by next year.

Implications on SP and enterprise ICT buyers:

  • Vodafone – Vodafone’s ICT solutions are primarily available in Europe. It needs to ramp up efforts to promote its ICT solution portfolio in APAC and MEA, to be seen as an end-to-end solution provider for global MNCs interested in expanding their operations in emerging markets. Furthermore, the company has to articulate its value proposition, specifically for verticals, to differentiate itself from its global and regional competition.
  • Enterprises – Asian automotive OEMs can evaluate Vodafone’s capabilities to provide M2M solutions for Infotainment, connected cars and insurance companies for usage based insurance (UBI) service. Global and regional MNCs expanding their business outside Asia can consider Vodafone’s network and ICT solution capabilities for cloud, M2M, and unified communications/collaboration against similar offerings from other global and regional service providers.

The New Analytics: Do Android Devices Dream of Electric Sheep?

Brad Shimmin

Brad Shimmin

Summary Bullets:

  • We are already living in the midst of some very smart mobile devices which are capable of capturing the physical, situational, operational and even emotional facets of the human machine.
  • So, why not donate this ‘big data’ to better serve ourselves and the greater good?

Being a hopeful believer in synchronicity (or at least a believer in the potential of coincidence), my ears perked up late last week when the third vendor in as many weeks mentioned the coming ‘Internet of Things’ during three seemingly unrelated discussions around analytics, collaboration and business apps.  Obviously, the idea of smart, interconnected devices has reached some sort of significant meme threshold for major firms IBM, SAP and VMware, helped no doubt by some excellent marketing from Cisco. Read more of this post

M2M Ecosystem Growing as Everyone Wants a Piece of the Action

Kathryn Weldon

Kathryn Weldon

Summary Bullets:

  • M2M World Congress, held in London on April 25th and 26th, brought together a diverse ecosystem of companies that offer M2M solutions, including prominent players such as operators, integrators and chipset/module vendors, as well as a few surprises.
  • Despite the relatively small annual revenues associated with M2M today, few companies want to be left out of what is predicted to be a trillion dollar market, with 20-50 billion connections and a wide variety of related services, equipment and software opportunities by 2020.

M2M World Congress was noticeably lacking in end users (with the exception of the UK National Grid), but most of the usual suspects participated, giving fairly high-level presentations on the market and on their particular solutions, along with the usual caveats concerning the obstacles that are still in the way of massive market growth.  There were a number of operator presentations and panels (with EE, Deutsche Telekom, Turkcell, Swisscom, Telefonica, Etisalat, Orange and satellite provider Inmarsat in attendance), as well as individual presentations by: Read more of this post

What Do Recent Reorganizations Tell Us About Global Operator Strategies?

Kathryn Weldon

Kathryn Weldon

Summary Bullets:

  • In February 2013, Orange Business Services launched Orange Mobile Enterprise, a unified organization for offering global mobility/M2M to MNCs.  Also in February, Deutsche Telekom announced a new organization, Business Excellence, to unify all of its B2B activities within one unit.  Around the same time, NTT DoCoMo launched its ‘Smart Life’ business model, shifting to a focus on (mostly consumer-facing) services involving media, commerce, M2M and finance/payments.
  • There were also reorganizations in 2012 at Telefonica, Vodafone and BT GS in which Telefonica Global Solutions and Vodafone’s Group Enterprise organization, respectively, were announced, while BT GS reorganized around five regions and nine verticals.  With six Tier 1 global operators streamlining their organizations over the last six months, we ask:  What are the common and uncommon themes in these launches?  Moreover, what is happening in the global operator market that requires these new units?

Global operators are focused on providing telecommunications and IT services both to domestic enterprises and MNCs (as well as consumers, of course, with increasingly blurry lines between segments due to consumerization and BYOD).  This focus includes both fixed and mobile connectivity services, value-added professional and IT services, as well as M2M solutions which require capabilities in all of the above areas.  Some operators (such as Vodafone) have come from a dominantly mobile position and are now focused on becoming broad-ranging ICT providers (or vice versa).   Yet others have determined their key growth markets/vertical opportunities, which may include both enterprise (B2B) and consumer (B2C) opportunities, and are looking for innovative ways to ride growth curves for security, e-commerce, e-health, M2M and other markets which are relatively small today but poised for big growth in the near future.  In addition, global operators with a strong domestic presence within their in-country operating companies may have come to realize that their enterprise-focused and MNC-focused initiatives need to be more effectively coordinated, to offer consistent messages, services and customer experience.  The six reorganizations reflect different combinations of these issues. Read more of this post

Global M2M Partnerships Heat Up, but Will They Succeed?

K. Weldon

K. Weldon

Summary Bullets:

  • For years, operators have been trying to crack the code on how to offer cost-effective global M2M services that can span multiple network footprints.
  • Two alliances – one from Jasper Wireless-enabled operators and one from standards bodies across the world – point to new models that may accelerate the growth of global M2M.

Over the last couple of weeks, there have been some unusual partnership announcements from the M2M ecosystem that may solve a set of problems which have thwarted the widespread growth of global M2M deals.  Last week, KPN, NTT DoCoMo, Rogers Communications, SingTel, Telefónica, Telstra, and Vimpelcom agreed to form an alliance to support a single, global platform that multinational businesses will leverage to enable connected devices to span multiple countries cost-effectively with a uniform SIM.  Since these operators all use the Jasper Wireless service delivery platform (as does AT&T, which was not part of the partnership), they can also service customers consistently; the Jasper platform provides a uniform portal for service activation, SIM management, troubleshooting, and subscription/rate management.  While a number of operators such as Orange, Vodafone, and AT&T have already developed global SIMs that can be used in multiple countries to simplify inventory management and related expenses, there has still been a lot of work to do to make global M2M seamless and cost-effective.  Some operators have also been working together to offer global connectivity at prices below the traditional expensive commercial roaming rates, but in many cases, enterprises have either had to set up relationships with multiple carriers or gone to aggregators to try to bridge together a global network with a single point of contact and single contract. Read more of this post

M2M: Operators vs. IT Service Providers

K. Weldon

K. Weldon

Summary Bullets:

  • Operators note that the annual increases in their M2M connections are running in the 25-40% range, which aligns with their own predictions and with overall industry growth estimates that would lead to a market of several billion connections by 2020.
  • As connectivity commoditizes, however, value-added services are the real ‘meat,’ estimated to generate as much as 70-80% of the total M2M revenue base over time.  What are the IT service providers doing to get some of this service revenue for themselves?

IT service providers are not standing idly by as operators start to offer consulting, advisory, and managed services for M2M.  In fact, many of them are actually empowering operators to gain M2M revenues through their telco vertical practices.  For example, Accenture and Tech Mahindra empower operators by offering assistance in making telcos’ business models more profitable, and by providing custom application development for the carriers’ enterprise customers.  However, there is an increasingly blurry line between what operators need to do to go up the value chain and what IT service providers traditionally do themselves.  How aggressive are companies such as IBM, Accenture, Logica, and Tech Mahindra in M2M; which areas provide partnering opportunities; and which areas do they want for themselves?  A few examples: Read more of this post

Looking Back on Mobile World Congress

K. Weldon

K. Weldon

Summary Bullets:        

  • My last blog’s predictions for MWC’s enterprise mobility themes focused on BYOD, the ‘connected life,’ and Nokia as a possible ‘comeback kid.’
  • While these were big themes, there were also many announcements and demos on MDM/security/MAM offerings (especially for Android),as well as recurring discussions on operator monetization and new service opportunities.

Mobile World Congress re-confirmed that enterprise mobility is a very important topic for many constituencies. While many of the themes we predicted were indeed major ones, there were a few others that were notable. Read more of this post

Visions of Barcelona

K. Weldon

K. Weldon

Summary Bullets:

  • MWC is a chance to listen to and interact with the mobility ecosystem (60,000 suppliers and end-users), which will be speaking loudly, excitedly and all in one place.
  • Three key trends to watch are the “connected life”, how to implement BYOD, and hopes by Nokia and RIM to generate new industry buzz.

I am writing this blog the day before I go to Mobile World Congress but it won’t be posted until the show is almost over. This is an experiment to test the theory that a good analyst can anticipate some of the main announcements and themes from the massive numbers of invitations to view products, attend demos, listen to pundits and meet both with top vendors and smaller players in the enterprise mobility market face to face. I am now looking into my crystal ball… Read more of this post

Enterprise Mobility 2012: What Can Businesses Expect in the New Year?

K. Weldon

K. Weldon

Summary Bullets:

  • Mobility will continue to be a huge priority for enterprises in 2012, with BYOD, mobile apps, mobile security, and tablet adoption as major themes.
  • How is the supplier ecosystem responding to the needs of business customers, and what will we see from them in 2012?

2011 was a busy year for enterprise mobility, as it was the year of the tablet (or at least the iPad) explosion; BYOD support became a priority (even beyond the U.S.); there was a surge in the development of mobile applications; mobile security finally gained precedence; the availability of LTE in the U.S. became widespread enough to matter; M2M deployments grew in the automotive, utility, and health care verticals – we could go on and on.  Suffice it to say that while enterprises are becoming increasingly dependent on mobile devices and applications, the supplier ecosystem (wireless operators, IT service providers, handset/tablet vendors, mobile application developers, enterprise infrastructure equipment vendors, and platform providers for TEM, MDM, mobile security, and mobile application enablement) has stepped up initiatives to generate revenues by satisfying the enterprise’s hunger for mobile solutions.  So, what were some of the key service launches in 2011 among these vendors and service providers, and what do we see as their priorities for 2012? Read more of this post

M2M Growth: Reality Check on the Rise of the Machine

K. Weldon

K. Weldon

Summary Bullets:

  • Enterprises deploying M2M solutions do not necessarily look to cellular; WiFi, Bluetooth, and Zigbee may be more cost-effective inside buildings, and wireline connections still make sense for many fixed devices.
  • M2M continues to grow, but the ecosystem has a lot of work to do to reach the huge numbers of predicted devices.

The M2M market is growing; there seems to be no doubt about that.  In fact, in comparison with other technology areas, the growth rates seem pretty healthy, with CAGRs of 25% typically reported by carriers and module manufacturers.  However, while M2M is often tied to the cellular industry, the reality is that only about 30% of the connections that make up today’s worldwide installed base of M2M devices are cellular.  Cellular connection numbers are still small, with an installed base of about 80 million mobile connections today.  In addition, M2M bandwidth requirements remain low, and the vast majority of cellular M2M applications today are comfortably served by 2G networks. Read more of this post