Vodafone show its faith in Indian growth with $1B investment

Vodafone shows faith in Indian growth with $1B investment

07 OCT 2014

Vodafone is pouring $1 billion into an upgrade of its network and retail outlets in India, according to a Bloomberg interview with country CEO Marten Pieters.

Pieters (pictured) is banking on data services to power future revenue growth in the market.

The investment is already earmarked under the operator’s Project Spring, which aims to extend 4G in Europe and 3G in emerging markets, among other objectives. It is funded by the proceeds from the sale of Vodafone’s stake in Verizon Wireless.

However, there are challenges to justify heavy investment in a market with low average ARPU and whose prospects are clouded by uncertainty over spectrum.

“It’s all about data,” said a bullish Pieters, speaking at the end of last month. “That’s the most exciting thing we see. If the customer gives me $2 or $3 a month, it’s very difficult for me to build a good network. Where in the rest of the world they get $20, $40, or even $60 or $80 in the U.S.”

The aim is to have 3G in every service area in India within two years, he said. And to have a first go at 4G with a test scheduled for next year.

Vodafone’s attraction to India is its relatively fast growth in service revenue, which last year was ten per cent. This far exceeds the performance of its European businesses, where service revenue fell by nine per cent.

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Richard Handford

Richard is the editor of Mobile World Live’s money channel and a contributor to the daily news service. He is an experienced technology and business journalist who previously worked as a freelancer for many publications over the last decade including...

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