Vodafone Group plc is a Britishmobile phone operator headquartered in Newbury, Berkshire, England. It is the largest mobile telecommunications network company in the world by turnover and has a market value of about $134 billion (June 2006). Vodafone currently has equity interests in 27 countries and Partner Networks (networks in which it has no equity stake) in a further 33 countries. At 30 June2006 Vodafone had 186.8 million proportionate customers in 27 markets across 5 continents. [1] ("Proportionate customers" means, for example, that if Vodafone has a 30% stake in a business with a million customers, that is counted as 300,000). On this measure it is the second-largest mobile telecom group in the world behind China Mobile. The six markets where it has more than ten million proportionate customers are the United Kingdom, Germany, the United States, Italy, Spain and Turkey. In the U.S., these customers come via its minority stake in Verizon Wireless, and in the other five markets Vodafone has majority-controlled subsidiaries. The name Vodafone comes from Voice data fone, chosen by the company to "reflect the provision of voice and data services over mobile phones." [2]
Vodafone's portfolio of global services, supported by its global brand, is available in a total of 59 countries. In a historic deal, on 17 March 2006 Vodafone Group announced an agreement to sell its ownership of Vodafone Japan (Vodafone K.K.) to SoftBank. On April 14, 2006 SoftBank and Vodafone K. K. jointly announced, that the brand and company name Vodafone will be changed to a "new, easy-to-understand and familiar company name and brand". Masayoshi Son became CEO (Representative Director) of Vodafone K. K.
On 30 May 2006, the company announced a loss before tax of £14.9 billion ($27.9bn) for 2005, the biggest loss in British corporate history. The loss for the year from continuing operations was £17.2 billion and the bottom line loss for the financial year was £21.8 billion. The company was pushed into loss by impairment charges of £23.5 billion, which related to the acquisition of Mannesmann several years earlier, and losses of £4.6 billion in relation to its discontinued business in Japan. At an operating level it remained highly profitable, with an operating profit on continuing operations of £9.4 billion before impairment costs.
*1 January 1985: First phone call on Vodafone United Kingdom's analogue network. This event is staged, due to a network failure; the first calls actually being made the next day. The first call is made to the Vodafone head office"which was at that point above a curry house in Newbury, where the company remains today (but now in a custom-built HQ building). *October 1991: Racal Telecom is demerged from Racal Electronics and becomes Vodafone Group. *June 1992: Vodafone Germany's (still as "Mannesmann Mobilfunk GmbH") network goes live.
Vodafone's original logo used until the intoduction of the speechmark logo in 1998.
*July 1992: Vodafone United Kingdom's GSM network goes live. *September 1992: Vodafone Sweden's network goes live under the name of Europolitan which later changed its name to Europolitan-Vodafone. *October 1992: Vodafone Portugal's (still as "Telecel, Comunicações Pessoais, SA") network goes live. *July 1993: Vodafone Greece's network (still as "Panafon Hellenic Telecommunications") goes live. *July 1993: Vodafone Ireland's GSM network goes live, as Eircell; a ETACS network had operated from ~1985. *September 1995: Vodafone Italy's (still as "Omnitel") network goes live. *November 1995: Vodafone Spain's (still as "Airtel") network goes live. *April 1997: Vodafone Romania's (still as "Connex") network goes live. *1998: Company introduces new logo, known as the Speechmark, as it is a quotation mark in a circle; the O's in the Vodafone logotype are opening and closing quotation marks, suggesting conversation. The logo often appears on the outline of a SIM card. *30 June1999: Vodafone Group Plc purchases AirTouch Communications, Inc. of the U.S., and changes its name to Vodafone Airtouch Plc. As Airtouch owns about 30 percent of the German Mannesmann group, Vodafone is required to shed its 17 percent holding in Germany's third-largest mobile provider, E-Plus. *21 September1999: Vodafone Airtouch announces a $70-billion joint venture with Bell Atlantic Corp. to be called Verizon Wireless, which was composed of the two companies' U.S. wireless assets and began operations on 4 April2000. *February - April 2000: After a months-long battle, Vodafone buys German conglomerate Mannesmann AG to get control over the mobile network operator Mannesmann Mobilfunk GmbH & Co KG, operating the "D2" network. The deal is one of the largest in European history and is Germany's first hostile takeover by a foreign firm. The conglomerate is subsequently broken up and all manufacturing related operations sold off. *28 July2000: Reverts to its former name, Vodafone Group Plc. *16 April 2001: First 3G voice call on Vodafone United Kingdom's 3G network. *2001: Vodafone takes over Eircell, then part of eircom in Ireland, and rebrands it Vodafone Ireland. *2001-2002: Vodafone acquires Japan's third-largest mobile operator J-Phone, which had introduced camera phones first in Japan. *17 December2001: Vodafone introduces the concept of "Partner Networks" by signing TDC Mobil of Denmark. The new concept involves the introduction of Vodafone international services to the local market, without the need of investment by Vodafone. The concept would be used to extend the Vodafone brand and services into markets where it does not have stakes in local operators. Vodafone services would be marketed under the dual-brand scheme, where the Vodafone brand is added at the end of the local brand. (i.e., TDC Mobil-Vodafone; Elisa-Vodafone; Bité-Vodafone etc.) *2 February2002: Finland is added into Vodafone's mobile community, as Radiolinja is signed as a Partner Network. Radiolinja later changed its named to Elisa. *2002: Vodafone rebrands Japan's J-sky mobile internet service as Vodafone live!™ as its mobile customer portal *3 December2002: Vodafone brand is introduced in the Estonian market with signing of a Partner Network Agreement with Radiolinja (Eesti). Radiolinja (Eesti) would later change its name to Elisa. *7 January2003: Vodafone signed a group-wide Partner agreement with mobilkom austria. As a result, Vodafone adds Austria, Croatia, and Slovenia in its partner network. *16 April2003: Og Vodafone is introduced in the Icelandic market. The company is the result of the partnering of Og Fjarskipti (The new name of Tal and Íslandssími after their merger) with Vodafone. *13 May2003: in Italy Omnitel, already Vodafone-Omnitel, is rebranded Vodafone Italy. *21 July2003: Lithuania is added to Vodafone's worldwide network, with the signing of a Partner Network agreement with Bité. *16 February2004: Vodafone signs a Partner Network Agreement with Luxembourg's LuxGSM. *20 February2004: Vodafone signs a Partner Network Agreement with Cyta of Cyprus. Cyta agreed to rename its mobile phone operations to Cytamobile-Vodafone. *November 2004: Vodafone introduces 3G services into Europe. *June 2005: Vodafone increases its participation in Romania's Connex to 99%. Vodafone also buys Czech mobile operator Oskar. *1 July2005: Oskar of Czech Republic is rebranded as Oskar-Vodafone.
Vodafone's Speechmark logo was introduced in 1998, with a revised version phased in in 2005. The O's in the name represent quotation marks (this reflects English usage). The logo was often shown against the silhouette of a SIM card.
*17 October2005: Vodafone Portugal launches a revised logo, using new text designed by Dalton Maag, and a 3D version of the Speechmark logo, but still retaining a red background and white writing (or vice versa). Also, various operating companies start to drop the use of the SIM card pattern in the company logo. (The rebranding of Oskar-Vodafone and Connex-Vodafone also does not use the SIM card pattern.) A custom typeface by Dalton Maag (based on their font family InterFace) forms part of the new identity. *28 October2005: Connex in Romania is rebranded as Connex-Vodafone. *31 October2005: Vodafone reaches an agreement to sell Vodafone Sweden to Telenor, the largest provider of telecommunications services in Norway, for approximately € 1 billion. The sale will be completed by the end of calendar year 2005. After the sale, Vodafone Sweden becomes a Partner Network. *13 December2005: Vodafone wins an auction to buy Turkey's second-largest mobile phone company, Telsim, for 4.5 billion. [3] *December 2005: Vodafone Spain becomes the second member of the group to adopt the revised logo, and it is phased in over the following six months in other countries. *05 January2006: The group announces the completion of the sale of Vodafone Sweden to Telenor. *01 February2006: Oskar Vodafone drops the Oskar name and becomes Vodafone Czech Republic, adopting the revised logo. *22 February2006: Vodafone announces that it is extending its footprint to Bulgaria with the signing of Partner Network Agreement with Mobiltel, which is part of mobilkom austria group. *12 March2006: Former chief, Sir Christopher Gent, who was appointed the honorary post Chairman for Life in 2003, quits following rumours of boardroom rifts. *4 April2006: Vodafone Sweden announces that it will change name to Telenor Sverige AB following the Telenor takeover of the Swedish Vodafone network. This occurs on 20 April. *11 April2006: Vodafone announces that it has signed an extension to its Partner Network Agreement with BITE Group, enabling its Latvian subsidiary "BITE Latvija" to become the latest member of Vodafone's global partner community. *26 April2006: Connex-Vodafone drops its original name and becomes Vodafone Romania, also adopting the new logo. *30 May2006: Vodafone announces the biggest loss in British corporate history (£14.9 billion) and plans to cut 400 jobs. Vodafone reported one-off costs of £23.5 billion due to the revaluation of their Mannesmann subsidiary.
* 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.
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History
*July 1993: BellSouth New Zealand's network went live. *October 1993: Vodafone Australia's network went live. *July 1994: Vodafone Fiji's network went live. *November 1998: Vodafone purchased BellSouth New Zealand, and it became known as Vodafone New Zealand. *1999-2000: J-Phone launched the J-sky mobile internet service in response to DoCoMo's i-Mode service. *December 2002: J-Phone's 3G network went live. *3 November2003: M1, as a Partner Network is added to the Vodafone footprint. *October 12003: Vodafone changed the name of its Japanese subsidiary from J-Phone to 'Vodafone', and the name of J-Phone's mobile internet service from J-Sky to Vodafone Live! *April 2005: Smartone changed the name of its brand from Smartone to 'Smartone-Vodafone' after the both company signed the Partner Network Agreement. *August 2005: Vodafone launched 3G technology in New Zealand *October 2005: Vodafone begins launching 3G technology in Australia *28 October2005: Vodafone announces the acquisition of a 10 per cent stake in India's Bharti Televentures, which operates the largest mobile phone network in India under the brand name AirTel. The acquisition involves two separate transactions. *22 December2005: Vodafone announces the completion of the acquisition of the 10% stake in Bharti Televentures of India. *25 January2006: Indonesia, Malaysia, and Sri Lanka are added to the Vodafone footprint as Vodafone Group signs a partner network agreement with Telekom Malaysia. *17 March2006: Vodafone Group announces an agreement to sell its 97.68% interest in Vodafone Japan (Vodafone K.K.) to SoftBank for £8.9 billion of which £6.8 billion will be received in cash on closing of deal. The brand "Vodafone K.K." is expected to change. *03 April2006: Vodafone New Zealand officially adopts the group's new logo *14 April2006: SoftBank and Vodafone K. K. jointly announce that the company name and brand of Vodafone K. K. will be changed to a "new, easy-to-understand and familiar company name and brand". Masayoshi Son becomes CEO and representative director of Vodafone K. K. *26 May2006: Vodafone Australia also adopts the group's new corporate logo.
Vodafone currently operates in the following countries in the Middle East and Africa region. The proporationate customer numbers are as at 31 December2005.
* Stakes in local Vodacom operating companies in Democratic Republic of Congo, Lesotho, Mozambique and Tanzania are held through the stake in VodacomSouth Africa. As the companies in the DRC, Lesotho, Mozambique, and Tanzania are only subsidiaries of an affiliate (Vodacom), Vodafone Group does not have direct formal relationships with them.
History
*Oct 1998: Vodafone Egypt network went live under the name ClickGSM. *18 September2002: Vodafone signs a Partner Network Agreement with MTC group of Kuwait. The agreement involved the rebranding of MTC to MTC-Vodafone. *29 December2003: Vodafone signs another Partner Network Agreement with Kuwait's MTC group. The second agreement involves the co-operation in Bahrain and the branding of the network as MTC-Vodafone. *3 November2004: Vodafone announced that its South African affiliate Vodacom has agreed to introduce Vodafone's international services, such as Vodafone live! and partner agreements, to its local market. *3 November2005: Vodafone announces that it is in exclusive talks to buy the 15% stake of VenFin in Vodacom Group, reaching agreement the following day. Vodafone announces it plans to purchase a controlling interest in VenFin, and then shed VenFin's other assets. Vodafone and Telkom will then have a 50% stake each in Vodacom. *03 April2006: Vodafone Egypt adopts the group's new logo.
* 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.
History
United States
In the United States, Vodafone owns 44.4%1 of Verizon Wireless, the country's second largest mobile carrier. Before this joint venture was formed, Vodafone merged with AirTouch Communications of the U.S. in June 1999 and changed its name to Vodafone Airtouch Plc. In September 1999, Vodafone Airtouch announced a $70-billion joint venture with Bell Atlantic Corp. The first wireless business with a national footprint in the U.S., Verizon Wireless was composed of Bell Atlantic's and Vodafone AirTouch's U.S. wireless assets and began operations on April 42000. However, Verizon Communications"the company formed when Bell Atlantic and GTE merged on June 302000"owns a majority of Verizon Wireless and Vodafone's branding is not used, nor is the network compatible with GSM phones. This relationship has been quite profitable for Vodafone, but there have historically been three problems with it. The first is the above-mentioned incompatibility with the GSM standard used by Vodafone's other networks, and the consequent difficulty of offering roaming between Vodafone's U.S. and other networks. The other two stem from the fact that Vodafone does not have management control over Verizon Wireless. Vodafone is thus unable to use the Vodafone brand for its U.S. operations, and (perhaps more importantly) has no control of dividend policy at Verizon Wireless and is therefore entirely at the mercy of Verizon management with respect to cash flow from Verizon Wireless to Vodafone. Perhaps as a consequence of these reasons, Vodafone made a bid for the entirety of AT&T Wireless when that company was for sale in 2004. Had this bid been successful, Vodafone would presumably have sold its stake in Verizon Wireless, and then rebranded the resultant business as Vodafone. As AT&T Wireless used the GSM standard, this would have resolved all the above problems. However, Cingular Wireless (a joint venture of SBC Communications (now AT&T) and BellSouth) ultimately outbid Vodafone and took control of AT&T Wireless, and Vodafone's relationship with Verizon has continued.
Early in 2006 Verizon announced their intent to buy-out the remaining 45% of Stock of Verizon Wireless from The Vodafone Group.[5]
Latin America
On 15 November2005, Vodafone Group announced a group-wide co-operation agreement with America Movil of Mexico. The agreement involves co-operation on international services and roaming. The services include Voice and GPRS Roaming services, Preferred Roaming and Virtual Home Environment. Included in the agreement are the 13 networks owned and controlled by America Movil (except Tracfone in the United States), and the various operating companies of Vodafone and its Partner Networks. Although the announcement only says that the two groups are partnering to deliver international roaming services, subsequent press releases of the Vodafone Group indicates that it has 27 (now 33) Partner Networks, therefore the 13 networks of America Movil in the agreement are considered Partner Networks.
1 Vodafone Group Plc. Key Performance Indicator press release for the quarter to 30 June2005, 25 July2005.
From its 31 March2006 year end onwards Vodafone will report its results in accordance with International Financial Reporting Standards (IFRS). It has issued results amended to IFRS standards for its 31 March2004 and 31 March2005 year ends for information purposes, and these are shown in the first table below. Vodafone has some large minority stakes, in particular in Verizon Wireless in the United States and SFR in France, which are not included in its consolidated turnover. In order to provide additional information on the overall scale and growth trends of its business it publishes "proportionate turnover" figures and these are included in the tables below. For example, if a business in which it owns a 45% stake has turnover of £10 billion, that equals £4.5 billion of proportionate turnover for Vodafone. Proportionate turnover is not an official accounting measure and Vodafone's proportionate turnover should be compared with other companies' statutory turnover. Vodafone also produces proportionate customer number figures on a similar basis, eg. if an operator in which it has a 30% stake has 10 million customers that equals 3 million proportionate Vodafone customers. This is a common practice in the mobile telecommunications industry.
*Losses for year to 31 March 2006 reflect write downs of assets, principally in relation to the Mannesmann acquisition. Proportionate turnover includes £7,100 million from discontinued operations. The following table shows Vodafone's results under UK generally accepted accounting principles (UK GAAP). By the end of its key acquisition drive, which ran from 1999 to 2002, Vodafone had more than £100 billion of goodwill on its balance sheet. As UK GAAP requires goodwill to be written off against the profit and loss account Vodafone has shown large statutory losses since then. However this write off of goodwill is purely an accounting adjustment and does not affect Vodafone's cash position or its ability to pay dividends. Despite the reported losses it is in reality a highly profitable company, and this is reflected in the fact that it has often been ranked among the top twenty companies in the world by market capitalisation. Vodafone's accounts for the years shown in the table below include a great number of material one off transactions, and apart from noting the rapid expansion of the group in the years covered, no conclusions about underlying trends should be drawn from the figures without examining the accounts in more detail.
