Global Industry Restructuring

NIRBHAY PANDEY
Who and where is Vodafone?
 Vodafone
 Started operations in 1982 as a UK only firm

 Substantial M&A activity through late 1990s, early 2000s

 Now operates in 28 countries across 5 continents -

 Provides services to 220 million customers worldwide

(50% in Europe)

 1 in 4 mobile users worldwide

 Where do we want to be?
 The world’s leading mobile communications services provider

 Work to keep our customers and gain more in intensely

competitive markets

 Work with business partners to ensure first-to-market

advantages for customers

 Work with business partners to develop products and services

and offer consistency across Group

 “In all the markets we want to be in” - a good company is

always on the look out for a good deal.
 Snapshot of mobile markets - constant
transformation
 Generally highly competitive - “born of competition”

 Lower prices - estimates range from market to market, but cost

of owning a mobile as a percentage of income generally
decreased to 1% of income.

 SPECTRUM…. Lifeblood of mobile industry

 Increased M&A action in 1990s/2000s, but always a high rate

of change - analogue, digital, SMS, 2.5G, WAP, GPRS, 3G .

 Currently requiring substantial capital investment in 2G to

maintain coverage and services (cell splitting)
Hutch is now
 Hutch came to India in collaboration with Essar as Hutchison Essar.
They always had better rates as compared to Airtel but the network
wasn’t as good as Airtel and hence it flopped in the beginning. Slowly
however, it started becoming popular thanks to their advertising
strategies and attractive prices

 Hutch has been taken over by Vodafone and has become Vodafone
Essar. Vodafone is the world’s largest mobile brand. And now Hutch’s
orange has turned into a Vodafone red.
How expensive is the brand makeover ?
 Hutchison valued at $ 18.8 billion .

 Vodafone paid $11.1 Billion to Hutchison Essar for a 67% stake in the
company. As a consequence of this high profile buyout. Hutch, the
brand that has become a household name in India thanks a small dog,
will be killed to introduce Vodafone.

 “This transition is probably the largest brand change ever undertaken

in this country and arguably as big as any in the world. it touches over
35 million customers, across 4,00,000 shops and thousands of our
own and our business associates’ employees,”