Making the Right Move

Vodafone India has been performing well both in terms of subscriber base and revenue. By the end of March 2012, the company had crossed a subscriber base of 150 mn and it became the third player to touch the 150 mn subscriber mark after Bharti airtel and RCom, registering a growth of 11.8%. On the subscriber base, Vodafone had a customer base of 150.5 mn with data customers totaling 35.4 mn, a y-o-y increase of 81.5%. This was driven by an increase in data enabled handsets and the impact of successful marketing campaigns. In terms of revenue, the company registered revenue of `34,099 crore in FY12 compared to `27,348 crore in FY11, registering a growth of 19.5%. And the company grew substantially in all its business units be it voice, messaging, fixedline, and data services.

Strong Growth and Earnings

This strong growth can be attributed to increase in the incoming and outgoing voice minutes, 51.3% growth in data revenue and excellent growth in business services. In terms of growth, Vodafone enterprise business has been growing at 50-60% higher percentage growth than consumer business, despite the launch of 3G services in 860 towns and cities.

There has been a drop in consumer additions on the consumer front and all operators are shifting towards enterprises (big, medium, and small) in a big way, as this is a new wave for all mobile operators in the country. A few months back, Bharti airtel rebranded its enterprise services and other operators are also looking at enterprise as a big revenue generator. Reliance was the second to enter and the company has recently rebranded its enterprise services as Reliance business services. Vodafone was the last to enter enterprise services and has rebranded its services as Vodafone business services.

With consumer business showing decline in growth, Vodafone business services was formed in 2009 to leverage growth in the enterprise business. All the operators have been leveraging on this segment as this is the future growth story for operators to boost their topline as well as bottomline.

Even for Vodafone, the enterprise business has been showing good growth despite being a late entrant as compared to its competitors. Speaking on Vodafone business services revenue, Naveen Chopra, director, Vodafone business services says, “Presently, Vodafone's business services contribute around 10% of the company's India turnover and the target is to reach 15-20% in 3-5 years time frame.”

Areas Focusing On

In terms of offerings, Vodafone business services focuses on 4 key areas. First, is the mobility where revenues come from data card, voice, and tablets. Second, on fixed services where the company is focused on offering PRI lines in around 35 cities. This is presently limited to large corporates and to few cities in terms of coverage. Third, the focus is on providing telesolutions or M2M solutions. In this case the focus is on doing IT and system integration wherever it is required. Fourth, the focus is on cloud based services which are planned to be deployed by the end of this year.

On M2M, Vodafone has a platform which is presently being customized for the Indian requirement, says Naveen Chopra. In terms of applications, M2M platform plans to focus on 4 verticals-vehicle analytics, logistics, smart metering, and health diagnostics. As these sectors are upcoming and has shown lot of promise during pilots conducted by Vodafone India for various companies. On vehicle analytics, focus is on increasing efficiencies. In the case of logistics, the focus is on helping the goods to reach destination safely. In case of smart metering, the emphasis is on saving power at all critical functions so that those benefits can be passed on to the respective enterprise users. On the health front, the focus is on health diagnostics so that patients can take preventive correction, wherever required.

In terms of manpower, Vodafone business services has around 1,000 people and the division has its presence in all 22 circles. On the other hand, Reliance business services has clubbed all 22 telecom circles into 12 operating circles so that one can provide better customer engagement. The circles are: Andhra Pradesh, Delhi, Gujarat, Karnataka, Kerala, Maharashtra, Madhya Pradesh, Goa, Odisha, and Chhattisgarh, Mumbai, Punjab, Haryana, and Jammu & Kashmir, Rajasthan, Tamil Nadu, and Andaman and Nicobar; Uttar Pradesh and Uttarakhand, and West Bengal, North East, Bihar, and Jharkhand.

Efforts to Enter the Big League

The company has been focusing on all types of customers be it global enterprises, large enterprises, SMEs, and government with different bouquet of services as per their requirement. The focus is to provide better customer experience. In terms of corporate base, Vodafone business services has around 8,000 large corporates and around 10,000 SME customers. “The company is focusing to take SME base to 100,000 within 18 months,” says Naveen Chopra. And to increase the base, the company has been focusing to enter the big league and join the team contest for providing a big boost to the SME sector which is considered to be a high growth area for the company.

With respect to verticals, Vodafone business services has a strong focus on BFSI, manufacturing, healthcare. On the government part, the company has started building capabilities to cater to this market and focus would be on PSUs, central mission mode projects, state mission mode projects, and R-APDRP projects catering to state electricity board.

In terms of services, the company offers: National private leased circuit, international private leased circuit, virtual private network, internet leased line, office wireline voice, toll free services, mobility applications, audio conferencing, location solutions, telemetry solutions, and security solutions.

In 2013, Vodafone is planning to do the complete integration of cable and wireless and this will help Vodafone's business services to incorporate new bouquet of services to its enterprise customers. Also the company can offer a lot of hosted applications. All this will help the company to come in the same league of Bharti airtel, Rcom, and Tata Communications.