Vodafone Global Strategy - Essay Example

Vodafone Global Strategy Telecom Goliath – Vodafone Strategy Document Table of Contents. Page Executive Summary 3 2 Introduction 4 3 The Hutch Deal 6 4 The Competition Issue 10 5 Competition Law in different Countries 11 i) UK 11 ii) USA 13 iii) EU 15 iv) India 18 6 The Vodafone Strategy 21 7 Conclusion 22 8 References 23 9 Appendix 24-30 1 Executive Summary Vodafone plc has had a short career of just over two decades in which we have seen an unprecedented rise of a conglomerate of enormous proportions. From acquiring just one Telecom circle in UK in 1982, it has now become Number One Telecom Company in revenue terms in the world and Number Two in terms of size (next to Telecom China). Vodafone history was examined and it was seen that it adopted the path of both vertical and horizontal approach to acquire its present size and position. It latest acquisition was in India where it feels the next growth opportunity will allow it to scale new heights. Its innovative technological offers keep its customers happy and this is Vodafone’s unique selling point (USP). Such a size inevitably draws attention of the Competition Laws of all countries and such Laws of four countries viz. US, UK, EU and India were examined and were found to be largely similar in their focus. Their aim is to disband or disallow cartels and collusive actions detrimental to the ultimate consumer and to let fairplay be the fulcrum of growth. In the backdrop of these Laws, Vodafone’s current strategy was examined and was found to be largely satisfactory and the conclusion drawn was for it to remain vigilant and focussed on good Customer Relationship to escape the long clutches of the Competition Law. 2 Introduction The name Vodafone conjures a Giant with footprints over a large part of the Globe. Its enormous presence in the Telecommunication Market is a remarkable story. The company took its shape in rather tentative beginnings and rose up to be the world number one in revenues in 2006. Racal Electronics plc was a subsidiary of Racal Strategic Radio Ltd and in 1982 it won one of the two Cellular Network Licences that were offered by the Telecommunications Department. The Network was named Racal Vodafone as Racal owned 80% and the balance of 20% was owned by Millcom and Hambros Technology Trust. The name Vodafone comprises of Voice, Data and Fone, and when combined gave the impression of transfer of voice and data over mobile phones. Vodafone plc was formally launched on 1st January 1985 and by the end of 1986 Racal bought out its two minor partners stake for GBP 110 million and Vodafone came into 100% ownership of Racal. Racal Strategic Radio Ltd was renamed Racal Telecom and Racal Electronics in 1988 and in the same year 20% of Racal was hive off and was valued at GPB 1.7 billion. In 1991 Racal Telecom was separated from Racal Electronics and out of it emerged the Vodafone Group plc. The Giant finally matured. From that time Vodafone never really looked back. It went on a buyout, merger, takeover and partnership spree which has ended in it having a complete hold on Europe today. As can be seen on the map below it has created a web like hold over most parts of the European Union. The road was bumpy and it has created a mammoth that suffered a huge loss in 2006 of GBP 14.9 billion, by far the biggest recorded corporate loss in the UK. However Vodafone earned an operating profit of GBP 9.4 billion in the same year. Vodafone’s corporate philosophy has been to expand vertically and horizontally and for this it adopted many creative routs. Where it could, it went for outright buyouts and in 1996 bought majority stakes in Talkland and Peoples Phone and Airtouch Communications in 1999, 1999, the year before Y2K, was an eventful year for Vodafone but for different reasons. In that year the stage was set for formation of Verizone Wireless and finally it was formed out of Vodafone’s US assets being merged with Bell Atlantic in 2000. In 1999 too Vodafone made an unsuccessful bid for Mannesmann who owned the largest mobile network in Germany. There was a hue and cry all over Germany as it was perceived to be hostile. Actually Mannesmann had already violated an earlier gentleman’s agreement with Vodafone and had entered its territory through purchase of Orange in UK. In retaliation Vodafone made the hostile bid which was rejected. But later the Mannesmann Board agreed to the then highest ever offer of GBP 112 billion in 2000. Within two months the EU also gave its approval. Of course the result was that the Mannesmann group was broken up and all other non related businesses were sold off to pay for this takeover. By 2000 the Vodafone group has emerged to be a world leader in Mobile coverage. At present, Vodafone has ownership interests in 27 countries across 5 continents. Currently Germany is the largest market for Vodafone with 30.6 million subscribers (as of December 31, 2006) while US (where it has 44.4 percent stake in Verizon is the second largest with 26.2 million users. At 31 December 2006, based on the registered customers of mobile telecommunications ventures in which it had ownership interests at that date, the Group had 198.6 million customers, excluding paging customers, calculated on a proportionate basis in accordance with the Companys percentage interest in these ventures. (Vodafone)Appendix In between and thereafter it went into partnerships with other local operators and covered market share everywhere, an area spanning US on the west to Japan in the east. 3 The Hutch Deal The Giant did not ignore India and entered this territory in 2005 by buying a 10% stake in Bharti Televentures, owners of the Airtel brand, of India but the Indian market was in its nascent stage then and Vodafone exited from this market within a year although it retained the Airtel stake. It sold back 5.6% of its stake back to Bharti in 2007 retaining 4.4% as strategic investment. It however realized that it would be missing the bus and the bustling Indian economy beckoned it again. India is the only country in the world in which both CDMA and GSM technology companies are growing side by side and growing at a fast clip. The last decade has seen slow but steady growth in both sectors. While it took 10 years to cross 100 million customers it took less than three years to grow beyond 200 million. This time Vodafone eyed Hutch which is the fourth largest operator in India and has operations in 16 telecom circles in India with a subscriber base of 19 million In Hutch 67% was owned by Hutchison Whampoa of Hong Kong and the balance 33% is held by Essar Group. Vodafone decided to bid for the entire stake of Hutchison and wooed the conglomerate. Starting at a bid price of $ 8 billion it finally paid a price of $ 11.1 billion on an Enterprise value of $ 19 billion. Surprisingly the deal was done in less than 2 months. But there was high drama before, during and after the deal went through. There was great speculation on pricing. Payment methods, control issues, Government permission and so on. There was intense competition too from the big Indian and the non-Indian players. This raised the stakes and Hutch got the best of deals out of this competition. No sooner than Vodafone declaring its interest in buying 67% of Hutch Essar Ltd (HEL), Essar who own the balance 33% announced in January that they were keen to takeover the senior partner Hutchison’s share. They declared that they did not need a due diligence as they were part of the company and three directors on its board. They were privy to all its commercial and technical affairs. They also took legal opinion that they had the Right of First Refusal in case Hutchison put up its stake for sale. Vodafone appointed Ernst & Young to carry out due diligence and in end January a price of $ 14 billion was established to be the enterprise value on which the Hutchison stake was to be valued. At this stage besides Essar, four other prominent players were onto the act. They were the Hinduja Brothers from UK. and Anil Ambani of Reliance Communications, Maxix and Orascom.. Hinduja had a stake of 5.1% in HEL which they had sold to Hutchison Telecom International Ltd in June 2006. It now regretted the move and was keen on a 51% stake, Orascom the Egyptian Cellular operator had agreed to take 10% of Hutchison’s stake in HEL but the Ministry of Company affairs threw a spanner in the works declaring that the foreign stakes cannot be sold to another foreigner without first taking the Indian stakeholders into confidence. Essar the Indian partner in HEL had lodged a complaint to the Ministry that achieved this desired response. This made Orascom to declare an intention that they too were serious contenders for a larger stake. Reliance Communications is the largest CDMA operator in India and the second largest mobile operator in India after Airtel. It wants a GSM footprint across the Indian market and getting HEL would enable it to achieve it faster. It got tow Private Equity players, Blackstone and Pacific Texas to join hands and declared that it could pay $ 13.5 billion for the whole of HEL stake. On the side Maxis of Malaysia also got interested and decided to join this league and showed interest in joining hands with the above trio to get a stake in HEL as well. The stage was now set and each player was trying its best to get away with the spoils. Amongst all this Hutchison was sitting pretty and finally declared that it was asking for bids and the highest bidder would get it all. Finally bids were called in February and after much boardroom wrangles Arun Sarin, CEO of Vodafone added a few billions to the war chest by revising the Enterprise value of HEL to $18 billion. This made Hutchison’s stake worth $ 11.1 billion and eventually the deal was settled between them and Vodafone emerged the winner. The war was not over yet as the crucial permission of Foreign Investment Promotion Board (FIPB) was required to finally allow the transfer to be completed. Under Indian law the stake of a foreign company is limited to 74% of a company’s shareholding. If the investment is held in more than one company then the total stake would also be limited to the same 74%. The complications begin now. Vodafone wanted to purchase the total overseas holding of HEL to get total control of the company. The shareholding pattern in HEL is as follows: Hutchinson Whampoa, Hong Kong 52% Asim Ghosh and Analjit Singh 15% Essar 33% (22% held overseas) Therefore the foreign stake in HEL stands at 64.24%. Vodafone had the choice to buyout the Essar stake to get full control of the company. The problem was that had Essar agreed to this then Vodafone would be breaching 74% limit set by FIPB. If Vodafone went to buy the 15% held by Asim Gosh and Analjit Singh then, although it would be the largest shareholder, but it would have confront with Essar on daily running of the company. Vodafone tried to buyout Essar’s holding but sensing an opportunity they raised their demand to $ 5 billion for their stake. This would have put very serious financial burden on Vodafone resources and the board declined Sarins’s request on this. It finally emerged that this was a ploy by Essar to retain its active interest in HEL, which it believes is going to reap the benefits of the Vodafone worldwide leadership in mobile holdings. Finally Vodafone emerged as the largest shareholder of HEL but with slightly diluted control as it agreed for Essar’s Ruia to become the Chairman of HEL. It has put up a brave front but it knows that Essar is a good team player and the track record proves it so far. Essar was always involved in operations even in the Hutchison’s days, but it never interfered on the technical front. However it could and did assert its presence on commercial issues. As of now Vodafone waits for FIPB clearance which should be forthcoming. In fact the unconfirmed newspaper reports have it on firm inside sources that the announcement on this line is expected next week. 4 The Competition Issue Creating of such behemoths raises a vital issue. What happens to competition and how these monopolies affect consumers? Competition Law has been promulgated in many countries of the world. With the world becoming a Global Village it is felt that the consumer needs protection from large companies who by virtue of their size and dominance overshadow the local and smaller company. Although the large companies initially offer cut throat competition to the smaller ones, but eventually they force them to either toe their line or they take them over. After that they are free to dictate their terms to the ordinary consumer. With increasing liberalization of trading activities and services across the globe, various laws have been written in different countries to protect consumers from monopolistic companies. Moves are afoot in almost all countries to modernize all such laws and update them wherever needed. The main objective of such laws is primarily to offer fair competitive process to all participants. This means prohibition of activities like making price fixing agreements between companies which are otherwise rivals. It also covers other similar arrangements where outputs are restricted or any anti-competition moves are made which are detrimental to the consumer. 5 Competition Law in different Countries i) UK The Fair Trading Act of 1973 had generalized provisions governing what was then perceived to be fair trade practices. In 2002 it was replaced by the Enterprise Bill and came into force in 2003. This Act sets out to transform the country’s approach to corporate bankruptcies and also gives the consumer more powers. It also introduced harsh penalties of up to 5 years in prison for indulging in cartel formations that attempt to fix prices or limit production. It also covered areas like share price fifing and rigging deals and contracts to favour individuals and groups. The Act also provides for consumers or consumer bodies to seek damages for losses suffered on account of above actions. In cases where traders do not meet their legal obligations by failing to give a service of reasonable standard the Act offers protection to consumers. It further gives authority to the Office of Fair Trading (OFT) to formally approve codes of practices for trade and industry and helps consumers by establishing standards. Consumer Bodies will henceforth be able to lodge complaints about aspects of market practices which are detrimental to the consumer and the OFT is obliged to respond to these within 90 days. The Act gives the OFT enhanced powers to regulate the markets and gives it independent statutory status for the benefit of consumers. The OFT now has powers to apply to court for disqualification of Company Directors in cases where their company is in breach of the law. This is a harsh penalty and is intended to keep the directors on their best behavior where consumer protection is involved. The OFT is now in a position to approach courts against those establishment that break other consumer laws. John Vickers, Chairman of the OFT said: "The Enterprise Act coming into force on 20th June is a major milestone in the development of competition and consumer law. The Act, building on previous legislation, creates a clearer and sharper framework for markets and enterprise. Markets that work well are good for consumers and all the fair-dealing businesses that serve them well."1 For the relief of companies the Act provides for new procedures in insolvency reforms where the balance has shifted in favour of Administration instead of the Judiciary. In many cases they do not require lengthy court procedures. ii) USA A concentration of wealth in the hands of few creates a monopoly. In the US the American dream is creation of wealth but it tends to become monopolistic in a society that adores its rich and famous. But it was recognized that monopolies or formation of trusts that restricted wealth to a few were against the consumer interest and to stop such activities the Congress passed the Sherman Antitrust Act of 1890. It was perceived that in fact such restrictive practice in are detrimental to growth and harmful for the ultimate consumer. This also the oldest of anti-trust laws of USA. It declares that, “Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal. Every person who shall make any contract or engage in any combination or conspiracy hereby declared to be illegal shall be deemed guilty of a felony, and, on conviction thereof, shall be punished by fine not exceeding $10,000,000 if a corporation, or, if any other person, $350,000, or by imprisonment not exceeding three years, or by both said punishments, in the discretion of the court”. (15 U.S.C. § 1)2 Initially the Sherman Anti-trust Act was passed with the aim of breaking up the Standard Oil Company and the word anti-trust was used as it was a trust at that time. However over passage of time it has become a competition law as it is known elsewhere in the world. Originally the Act was used against businesses that formed cartels and raised prices with restrictive trade prices but at times it was used as the anti-union law as well. In 1914 a new Clayton Anti-trust Act was passed by Congress to replace it. This Act used the word Monopoly for the first time. The Sherman Act is a Federal law and all states have passed similar laws for protection of their consumers. However the Commerce clause of this act is very widely interpreted and governs all inter-state commerce. The intention is to create an atmosphere where it becomes unlawful to form business trusts, which are called cartels elsewhere, and from time to time various penalties have been prescribed. In 2004 President George W. Bush signed the Antitrust Criminal Penalty Enhancement and Reform Act, which increased the maximum criminal penalty for individuals to ten years imprisonment and a $1 million fine. The maximum penalty for corporations was raised to a $100 million. Since the Sherman Anti-trust Act many supplementary Acts have been added like Clayton Ant-trust Act of 1914, Robinson-Patman Act of 1936 and the Hart-Scott-Rodino Anti-trust Improvements Act of 1976. There has been some serious criticism of the Anti-Trust laws. Most recently Alan Greenspan said that "No one will ever know what new products, processes, machines, and cost-saving mergers failed to come into existence, killed by the Sherman Act before they were born. No one can ever compute the price that all of us have paid for that Act which, by inducing less effective use of capital, has kept our standard of living lower than would otherwise have been possible." This is by far the most biting of comments coming from a very responsible Government official. (Anti-Trust Essay June 1998)3 When the European Union was formed, its main objective was to bring entire Europe into one single market with common laws. Top on the European Commission (EC) was formation of laws that dealt with competition. It area of coverage are Anti-trust – prevention of collusion and anti-competitive practices. This is covered under Article 81 and 82 EC. Mergers – proposed control of mergers, specially of the cross borders kind which intend to form formidable authority wielding companies State Aids –subsidizing of industry and agriculture by governments to prop up their uncompetitive incompetence. Article 81(1) prohibits ‘all agreements between undertakings, decisions by associations of undertakings and concerted practices which may affect trade between member states and which have as their object or effect the prevention, restriction or distortion of competition within the common market.’(Article 81 of the EC Treaty)4 This article specifically makes it illegal to have collusion of any kind between producers, between retails or even amongst them both simultaneously to effectively control prices or restrict availability of goods and/or services that are detrimental to the consumer. There are some exceptions that are allowed and they are Where the Commission feels it is in the interest of Consumers like in case of convergence of technologies. Article 81(3) Where it applies to very small companies who do not hold more than 10% of the share of a market but price fixation is not permitted. This is often debatable but nevertheless the intention is favourable to consumers, and Where block agreement are allowed such as common terms and conditions that apply across all companies to bring uniformity in contracts. Article 82 covers the rules regarding “abuse of dominant position”. This provides “Any abuse by one or more undertakings of a dominant position within the common market or in a substantial part of it shall be prohibited as incompatible with the common market insofar as it may affect trade between Member States. Such abuse may, in particular, consist in: (a) directly or indirectly imposing unfair purchase or selling prices or other unfair trading conditions; (b) limiting production, markets or technical development to the prejudice of consumers; (c) applying dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage; (d) making the conclusion of contracts subject to acceptance by the other parties of supplementary obligations which, by their nature or according to commercial usage, have no connection with the subject of such contracts.”(Article 82 of EC Treaty)5 The State Aids is a special feature of Europe and a great restraint on free competition. Through this exercise the states frustrate genuine competence of others and thrust upon the general public the incompetent production and prices of industry and agriculture. It seeks to keep out genuine competition by promoting self interest. This kind of anti-trust is difficult to beat as it is state sponsored. The purpose of the creation of EU was to unify all member states but if the states themselves show protectionist tendencies then the very purpose stands defeated. The most glaring example is that of farmers of France. The French Governments stoutly backs them in their inefficient productive activities and creates barriers for free trade practices by others. In view of this state let act there is nowhere the competition or the consumer can go for help. The Director General of the Directorate General for Competition is the competent authority who listens to appeals and gives binding directions which apply to the whole of EU. However it is also left open to various member states to apply the laws of their nations through their own legal systems on same principals and this authority was decentralized on 1st May 2004 for this purpose. iv) India India had a Monopolies Restrictive Trade Practices Act (MRTP) since 1969 which laid down rules against formation of cartels and other trade practices that were injurious to consumers and other trades and practices. The Act followed the general lines of other competition laws of the more advanced countries like US, UK, EU, etc. and were generally prohibiting the unfair trade practices of individuals or groups that were of monopolistic nature. With the onset of a liberalized economic regime it was felt that the old MRTP Act was becoming outdated in modern times. Hence the Indian Parliament passed a new Competition Act in 2002 to replace the old Act. The salient features of this Act are: “Anti competitive agreements 3. (1) No enterprise or association of enterprises or person or association of persons shall enter into any agreement in respect of production, supply, distribution, storage, acquisition or control of goods or provision of services, which causes or is likely to cause an appreciable adverse effect on competition within India. (2) Any agreement entered into in contravention of the provisions contained in subsection (1)shall be void. (3) Any agreement entered into between enterprises or associations of enterprises or persons or associations of persons or between any person and enterprise or practice carried on, or decision taken by, any association of enterprises or association of persons, including cartels, engaged in identical or similar trade of goods or provision of services, which— (a) directly or indirectly determines purchase or sale prices; (b) limits or controls production, supply, markets, technical development, investment or provision of services; (c) shares the market or source of production or provision of services by way of allocation of geographical area of market, or type of goods or services, or number of customers in the market or any other similar way; (d) directly or indirectly results in bid rigging or collusive bidding, shall be presumed to have an appreciable adverse effect on competition”.(The Gazette of India)6 As can be seen this Act is in conformity with similar Acts of other countries but with a distinct local flavour to cater to its culture. However the important exceptions that are included in this Act are that there will be no infringement of the following Acts, “(a) the Copyright Act, 1957 (14 of 1957); (b) the Patents Act, 1970 (39 of 1970); (c) the Trade and Merchandise Marks Act, 1958 (43 of 1958) or the Trade Marks Act, 1999 (47 of 1999); (d) the Geographical Indications of Goods (Registration and Protection) Act, 1999 (48 of 1999); (e) the Designs Act, 2000 (16 of 2000); (f) the Semi-conductor Integrated Circuits Layout-Design Act, 2000 (37 of 2000); (ii) the right of any person to export goods from India to the extent to which the agreement relates exclusively to the production, supply, distribution or control of goods or provision of services for such export.”(The Gazette of India)7 From the exhaustive provisions it is observed that this Act has drawn heavily from the various provisions of similar Acts in other countries. Yet it is mindful that India being a comparatively recent entrant to new global marketing era, it has deferred to various Intellectual Property Rights and has excluded them from the provisions of the Act. Normal courts decide the issues raised under this Act. Besides various Competition Rules have been framed and are supervised or enforced by the following authorities: The Securities Exchange Board of India (SEBI) The Telecom Regulatory Authority of India Banking Ombudsman Central and State Electricity Regulatory Authorities Insurance Regulatory Development Authority (IRDA) National and State Consumer Redressal Forums Where the law does not cover the situation adequately, there is provision to draw upon the case law as evolved by Competition authorities of developed countries including US, UK, EU, Japan and Australia. 6 The Vodafone Strategy Looking at the size and the global scale of operations, Vodafone would be a prime target of the Competition Acts of all countries. It has largely kept itself out of controversy by adopting prudent practices. Firstly it has fair competition in almost all countries it operates in. Its market share is dominant in many cases but it plays by the rules of the Regulatory authorities of the country of operation. Secondly it is branching out to the Asia Pacific Region in a big way and avoiding further exposure in its home base of Europe. Thirdly it is very innovative and introduces new technologies very frequently. This gets it favourable consumer opinion and keeps it away from the clutches of these Acts. It is constantly delivering value for money. Its strategy for growth is to reduce costs and increase revenue through increased usage. This is done by intensive use of IT and softwares. It aims at satisfying customer needs by delivering innovative solutions. For this it relies on offering customers new device uses that fit in his lifestyle in the modern era. It is also decentralizing most operations in order to get more local support and react faster to local needs. This has been the strategy adopted by Vodafone so far. In view of the various Competition Laws the world over, it will be prudent for it to keep offering better services, lower costs and innovative technologies to its customers. This way it can overcome any objection and can downplay its vast holding in the marketplace. 7 Conclusion Vodafone is in a unique position in its industry. It is Telecom Giant which is vulnerable because of its size and has to be wary of competition as well as regulatory authorities that might feel that it is throttling the customer by stifling competition. This Giant has to maintain a fine equilibrium and constantly watch its step. The best way out of this is to adopt a very open minded Consumer Relations Policy. The focus of any Competition Law is either collusion or collaboration between companies to corner the market, to fix prices or to restrict output. Vodafone wants to be and remain number one in its chosen field. There have to be collaborations and partnerships to achieve this goal. The trick will be to attain all these but with objective of delivering value for money to the ultimate customer. The customer must always have an option to go for different suppliers to get the best bargain. In India or similar countries where Vodafone faces competition the situation is one of ease as enough competition will keep the watchdog regulators out but in places like Europe where it dominates the markets it has to offer enough choices to the customer to avoid attraction to itself under competition rules. It has to be a constant vigil and good Customer Relations practices will help it to avoid any nasty situation. (word count 4917) 7 References: 1 Available at: http://www.out-law.com/page-3648 2 Available at: http://www.law.cornell.edu/uscode/html/uscode15/usc_sec_15_00000001--- -000-.html 3 Available at : http://www.polyconomics.com/searchbase/06-12-98.html 4 Available at: http://ec.europa.eu/comm/competition/legislation/treaties/ec/art81_en.html 5 Available at: http://ec.europa.eu/comm/competition/legislation/treaties/ec/art82_en.html 6 THE GAZETTE OF INDIA-EXTRAORDINARY PART II — Section 1 PUBLISHED BY AUTHORITY NO. 12 NEW DELHI, TUESDAY, JANUARY 14, 2003 / PAUSA 24, 1924 Separate paging is given to this Part in order that it may be filed as a separate compilation. MINISTRY OF LAW AND JUSTICE (Legislative Department) New Delhi, the 14th January, 2003/Pausa 24, 1924 (Saka) Available at : http://72.14.235.104/search?q=cache:QAqx21h7uh0J:www.competition-commission-india.nic.in/Act/competition_act2002.pdf+competition+act+2002&hl=en&ct=clnk&cd=1&gl=in&client=firefox-acommission- 7 ibid Appendix Map of Vodafone in Europe: Red: Vodafone Violet: Vodafones affiliates Orange: Vodafones partners Wikepedia Vodafone in Europe Vodafone currently operates in the following countries in Europe. The proportionate customer numbers are for December 2005: Country Network Name (former) Ownership Proportionate Customers Market Share; Rank Local Competitor(s) Albania Vodafone 99.9% 919,000 48%; 2/2 AMC Austria A1 0% -- 38.7%; 1/4 T-Mobile, One, 3 Belgium Proximus 0% -- 48.7%; 1/4 Base, Mobistar Bulgaria Mobiltel 0% 4,000,000 52.5%; 1/4 GloBul,Vivatel Croatia VIPnet 0% -- 42.9%; 2/3 T-Mobile, Tele2 Republic of Cyprus Cytamobile-Vodafone 0% -- 89.5%; 1/2 Areeba Turkish Republic of Northern Cyprus KKTC Vodafone 100% no data available ?;2/2 KKTCell Czech Republic Vodafone (Oskar) 100% 2,413,000 19.62%; 3/3 O2, T-Mobile. Denmark TDC Mobil 0% -- 41.4%; 1/4 Sonofon, Telia, 3 Estonia Elisa Oyj (Radiolinja) 0% -- ?%; 1/3 Tele2, EMT Finland Elisa Oyj (Radiolinja) 0% -- 30%; 1/3 Sonera, Finnet France (Metropolitan) SFR 43.9% 17,101,000 (30 June 2005) 36%; 2/3 Orange, Bouygues Télécom Germany Vodafone (D2) 100% 30,622,000 35.64%; 2/4 T-Mobile, E-Plus, O2 Greece Vodafone (Panafon) 99.9% 4,955,000 35.6%; 2/4 Cosmote, TIM Hellas, Q-telecom Hungary Vodafone 100% 2,134,000 21.41%; 3/3 T-Mobile, Pannon Iceland Vodafone (Og Vodafone; Tal, Íslandssími) 0% -- 35%; 2/2 Síminn, Sko, HIVE Ireland Vodafone (Eircell) 100% 2,178,000 51%; 1/4 O2, Meteor, 3 Italy Vodafone (Omnitel) 76.86% 20,129,000 35%; 2/4 TIM, Wind, 3 Latvia Bitė Latvija 0% -- ?%; 3/3 LMT GSM,Tele2 Lithuania Bitė Lietuva 0% -- ?%; 2/3 Tele2, Omnitel Luxembourg LUXGSM 0% -- 64%; 1/5 Tango, VOXmobile Malta Vodafone (Telecell) 100% 188,000 54%; 1/2 Go Mobile Netherlands Vodafone (Libertel) 99.9% 3,817,000 24.2%; 2/4 KPN, T-Mobile, Orange Poland Plus GSM 19.6% 2,112,000 33%; 2/3 Orange, Play, Era Portugal Vodafone (Telecel) 100% 4,618,000 37.2%; 2/3 TMN, Optimus Romania Vodafone (Connex) 100% 7,717,000 45.4%; 2/5 Orange, Cosmote, Zapp Mobile Slovenia Si.mobil-Vodafone 0% -- 24.9%; 2/3 Mobitel Spain Vodafone (Airtel) 100% 14,464,000 33.1%; 2/4 movistar, Orange, Yoigo Sweden Telenor (Vodafone; Europolitan) 0% -- 16%; 3/4 Telia, Tele2, 3, Switzerland Swisscom 0% -- 62%; 1/3 Orange SA, TDC, Tele2 Turkey Vodafone(Telsim) 100% 12,748,000 24%; 2/3 Turkcell, Avea United Kingdom Vodafone 100% 16,939,000 24%; 2/5 O2, T-Mobile, 3, Orange UK * Local company with more than 50% being owned by the parent company is considered a Subsidiary; Ownership of less than 50% makes the local company an Affiliate. Local companies without ownership at all are Partners. Vodafone in Asia-Pacific Vodafone currently operates in the following countries in the Asia-Pacific region. The proportionate customer numbers are at 30 June 2006: Country Network Name (former) Ownership Proportionate Customers Market Share; Rank Local Competitor/s Australia Vodafone 100% 3,278,000 8%; 3/4 Telstra, Optus, 3, Virgin Mobile China (Mainland) China Mobile 3.3% 8,250,000 (30 June 2005) 65%; 1/2 China Unicom China (Hong Kong) SmarTone-Vodafone (SmarTone) 0% -- ?%; 2/5 3, Peoples, CSL, New World, PCCW Fiji Vodafone 49% 95,000 100%; 1/1 Indonesia XL 0% -- ?%; 3/4 Telkomsel, Indosat, 3 India AirTel 4.4% 39,000,000 22.9%; 1/ Bharat Sanchar Nigam Limited, Reliance Communications, Idea, Spice, Aircel India Hutch 67% 15,611,000 10.99%; 4/ Malaysia Celcom 0% -- 31.2%; 2/3 Maxis Communications, Digi.com New Zealand Vodafone (BellSouth) 100% 2,200,000 52.4%; 1/2 Telecom Samoa Digicel 0% -- Singapore M1 0% -- 28.5%; 3/3 SingTel, StarHub Sri Lanka Dialog 0% -- ?%; 1/4 note:50% ownership of local company is considered a Subsidiary; Less than 50% makes the local company an Affiliate. Local companies without ownership are Partners. ** data based on the assumption of the expected completion of the complex transaction in second quarter 2007 Vodafone in the Middle East and Africa Vodafone currently operates in the following countries in the Middle East and Africa region. The proporationate customer numbers are as at 31 December 2005. Country Network Name (former) Ownership Proportionate Customers Market Share Status Bahrain MTC-Vodafone -- -- 33%; 2/2 Partner Democratic Republic of Congo Vodacom 25.5%* 49%; 1/? * Egypt Vodafone 55% 9,800,000 47%; 2/3 Subsidiary Kenya Safaricom 35% 1,221,000 63.86%; 1/2 Affiliate Kuwait MTC-Vodafone -- -- 59.45%; 1/2 Partner Lesotho Vodacom 44.15%* 80%; 1/2 * Mozambique Vodacom 49%* 33%; 2/2 * South Africa Vodacom 50% 7,043,000 59%; 1/3 Subsidiary Tanzania Vodacom 32.5%* 55%; 1/? * *Held through the affiliate, Vodacom South Africa; therefore Vodafone Group does not have direct formal relationships with them. Vodafone in the Americas Vodafone currently operates in the following countries in the Americas region. Country region/territory Network Name (former) Ownership Proportionate Customers Market Share Official Website Local Competitor/s Antigua and Barbuda Digicel 0% -- www.digicelantiguaandbarbuda.com Argentina CTI Móvil 0% -- 32%; 2/3 www.cti.com.ar Personal, movistar Barbados Digicel 0% -- www.digicelbarbados.com Bermuda Digicel 0% -- www.digicelbermuda.com Brazil Claro 0% -- 24.0%; 3/? www.claro.com.br Vivo, TIM, Oi Chile Claro (Smartcom) 0% 0 16.7%; 3/3 www.clarochile.cl movistar, Entel PCS Colombia Comcel 0% -- 64.26%; 1/3 www.comcel.com movistar, Colombia Móvil Dominica Digicel 0% -- www.digiceldominica.com Ecuador Porta 0% -- 65.4%; 1/? www.porta.net movistar, Alegro PCS El Salvador Claro (CTE Personal) 0% -- 34%; ?/? www.claro.com.sv movistar, Tigo, Digicel France French Guiana Digicel 0% -- www.digicel.fr Orange SA Guadeloupe Martinique Grenada Digicel 0% -- www.digicelgrenada.com Guatemala Claro (PCS Digital) 0% -- 47%; 1/? www.claro.com.gt movistar, Tigo Guyana Digicel 0% -- www.digicelguyana.com Haiti Digicel 0% -- www.digicelhaiti.com Honduras Claro (PCS Honduras) 0% -- 37%; ?/? www.claro.com.hn Jamaica Digicel 0% -- www.digiceljamaica.com Mexico Telcel 0% -- 77.14%; 1/4 www.telcel.com movistar, Iusacell, Unefon Netherlands Aruba Digicel 0% -- ?; ?/? www.digicelaruba.com Bonaire Digicel 0% -- ?%; ?/? www.digicelbonaire.com Curaçao Digicel 0% -- ?%; ?/? www.digicelcuracao.com Nicaragua Claro (Enitel) 0% -- 68%; 1/? www.claro.com.ni Paraguay CTI Móvil (Porthable) 0% -- 12%; 4/4 www.cti.com.py Personal, Tigo, VOX Peru Claro (TIM) 0% -- 36%; 2/3 www.claro.com.pe movistar St Kitts and Nevis Digicel 0% -- www.digicelstkittsandnevis.com St Lucia Digicel 0% -- www.digicelstlucia.com St Vincent and the Grenadines Digicel 0% -- www.digicelsvg.com Trinidad and Tobago Digicel 0% -- www.digiceltt.com United Kingdom Anguilla Digicel 0% -- ?; ?/? www.digicelanguilla.com Cayman Islands Digicel 0% -- ?%; ?/? www.digicelcayman.com Turks and Caicos Digicel 0% -- ?%; ?/? www.digiceltci.com United States Verizon Wireless 45% 22,785,000 ?%; 2/4 www.verizonwireless.com Cingular, Sprint, T-Mobile, Alltel Uruguay CTI Móvil 0% -- 17%; ?/? www.cti.com.uy movistar, ancel * Local company with more than 50% being owned by the parent company is considered a Subsidiary; Ownership of less than 50% makes the local company an Affiliate. Local companies without ownership at all are Partners. Read More