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Vodafone Carrier Services Joel Stradling, Current Analysis Research Director, Business Network and IT Services July 8, 2014 Company Assessment Wholesale Services Vodafone Carrier Services Joel Stradling, Current Analysis Research Director, Business Network and IT Services July 8, 2014 J Summary Competitive Index Overall Position Joel Stradling Strategy Current Analysis Research Director Products Sales Strategy Support Partnerships itive ng ng Stro mpet Leader Vulnerable Co Very Stro August 20, 2013 July 8, 2014 Copyright © 2014 Current Analysis, Inc. Competitive Strengths • VCS has completed the internal integration and reorganization bringing together buying and selling activities across 26 operating companies. • VCS can combine best-of-breed services with powerful buy/sell synergies to be a strong competitor. • Vodafone Group provides strong financial backing. • The former Cable & Wireless Worldwide provides global network assets and existing wholesale market traction. • VCS owns substantial undersea cables and is investing in more undersea backhaul and IP transit. Competitive Weaknesses • Work is ongoing to integrate networks and back-office OSS in order to combine Vodafone’s assets with the former Cable & Wireless assets into a single efficient structure. • More progress is required to provide more detailed product specifications, for example in the area of IPX. • Competitors currently present their wholesale carrier service portfolios and current developments in more comprehensive detail via web presentations, press and marketing; examples include BICS, Sparkle and TSIC. © 2014 Current Analysis Inc. All rights reserved. For more information, please call +1 703 404 9200, toll-free +1 877 787 8947 Europe +33 (0) 1 41 14 83 15. Or visit our Web site: www.currentanalysis.com 1 Company Assessment Vodafone Carrier Services (Continued) Strategy: Very Strong Vodafone Group Enterprise, the new Vodafone Carrier Services (VCS) division combines the carrier services busi- nesses of Vodafone Group with the global wholesale activities of the former CWW. VCS has completed its integration program placing together buying and selling units across 26 operating companies and the former CWW operations in a single group. This sensible activity results in VCS giving a single face to its customers through global account man- agement and national account management structures. The carrier is now focused on developing three core product areas including voice, network capacity and mobility. Recognizing growth opportunities that derive from grand scale existing traffic volumes, including retail traffic from its global base of mobile and fixed customers, VCS is investing in its global voice platform. Leveraging VCS’ scale should deliver cost reductions and revenue growth. When VCS has completed its unified global platform, it will be able to control voice quality end-to-end and support of HD voice and VoLTE services, both between Vodafone customers and with interconnected partners. Underpinning its global voice platform, Vodafone is currently deploying IPX connectivity, based on its existing global MPLS network, which currently covers more than 40 countries and will cover more than 65 by 2015. Their IPX already supports a rapidly growing 4G roaming footprint and will be the primary interconnection platform for an increasing range of IP-based services – including voice, roaming, signalling, HD voice and VoLTE. VCS sells its car- rier services to other telcos, ISPs, OTT players and communications providers and at the same time delivers efficien- cies and cost-savings to Vodafone Group internal customers. Previously, Vodafone operating companies conducted e-auction deals for voice trading, but with the formation of VCS as a single interface to Vodafone, the deals are large volume-based agreements which deliver economies of scale and cost savings when both buying and selling. The company has established business with large Internet players such as Google, Amazon and Skype. In the UK, VCS has a dedicated portfolio for targeting facility-based carriers and partners and its LLU offerings can be provided on flexible terms and the carrier can demonstrate good customer service levels and quality to differentiate from competitors. VCS’ strengths include global network presence in over 150 countries, its IPv6-enabled global network and presence in over 80 cable systems, including its new investment in the Bay of Bengal Gateway (BBG) as well as the Europe-Persia Express Gateway (EPEG), Europe India Gateway (EIG) and West Africa Cable System (WACS). Its continuing network investment in India, Africa and Asia-Pacific, as well as its Global Markets Solutions Centre in India, make it an attractive partner for carriers in these regions. Solutions/Services/Products: Strong Vodafone Carrier Services’ portfolio spans fixed and mobile carrier services backed by global and local/granular reach. The service provider’s portfolio includes international wholesale voice, ITFS, services in mobile and fixed voice, data and messaging connectivity, public and private IP VPN and private carrier MPLS services, access and last-mile services in countries such as the UK, Germany, India, Turkey and New Zealand, South Africa, the rest of Africa, the Netherlands, Spain, Ghana and Qatar. Current product development initiatives are underway in the areas of IPX, intelligent routing (global IP switching) including consolidating IP traffic onto the single AS 1273 number, and an SMS hub solution. The strategy for voice and IP is first to reduce operational costs and then to begin selling service on the lower-cost base platform. VCS offers a Global VoIP Interconnect (GVI) product as part of its wholesale voice range, appealing to new communication service providers and small ISPs/telcos that wish to start out on a new voice business designed around an IP voice strategy from the outset. VCS also offers ‘managed voice’ outsourcing, which has the potential to drive new business and sales and offset falling voice revenue pressure. The company is making good progress in adapting such products for global markets through its Global Markets Solutions Centre in India. Wholesale data centre and flexible computing (cloud) solutions are available and the company offers advanced security services such as DDoS blackholing to content providers. VCS carries nearly 60 billion unregulated voice minutes across its IP and TDM core, with CLI and enterprise QoS for TDM and IP voice calls, with its Global VoIP Interconnect gateway bridging between the two technologies. It is working on a TDM-VoIP migration strategy © 2014 Current Analysis Inc. All rights reserved. For more information, please call +1 703 404 9200, toll-free +1 877 787 8947 Europe +33 (0) 1 41 14 83 15. Or visit our Web site: www.currentanalysis.com 2 Company Assessment Vodafone Carrier Services (Continued) for national markets. VCS offers a specific portfolio for its UK carriers and is working to provide carriers with innovative solution bundles comprising two or more of the following products: IP VPN, Ethernet WAN options, dedicated Internet access, SIP trunking, wholesale broadband and a managed application/SaaS portfolio, and hosted Exchange. IP Centrex and managed fixed/mobile convergence products are in the pipeline. Marketing/Sales Strategy: Very Strong Vodafone Carrier Services combines the carrier services businesses of Vodafone’s operating companies and CWW into a single-entity business. Marketing messages are built upon network capabilities at both the global and granular in-country level, with highlighted benefits of economies of scale. VCS has put in place global account management and national account management. VCS is building its brand recognition as a wholesale provider around the world, and it has a dedicated, multilingual sales team to spearhead in-region business development. VCS has implemented a global account management approach for its top 50 customers and partners while putting in place dedicated local account management teams to serve other customers. Customer Service and Support: Very Strong VCS emphasizes customer service and support. The carrier is focusing on customer experience improvement by integrating service delivery and assurance across it operating companies and CWW into a consolidated distributed organization with a common operating model and common processes. Customers within the top 50 are allocated a global service management model, while local service management teams are responsible for other customers. These teams conduct regular service and quality reviews with customers and partners. VCS continues to enhance its customer portal for wholesale IP VPN, dedicated Internet access, SIP trunking and Ethernet services, increasing the level of personalization with which wholesale customers can place orders, raise trouble tickets and access billing and performance management data. An online pricing tool supports managed bandwidth, IP VPN, Ethernet and Internet access, with traceability from quote to bill. Partnerships: Very Strong VCS has extensive geographical network coverage and is in a position to deliver network services across Europe, Asia, Africa, the Middle East and Australasia. The company is thus capable of delivering services to customers and partners such as Orange, BT, Telefonica, Etisalat, AT&T, Verizon, Telecom New Zealand, MTN and Airtel. VCS has a strong partnership strategy through which it extends its network reach for wholesale and enterprise customers. It has eight IP/MPLS NNIs with partner carriers, including China Telecom and China Unicom, which means that it is one of the few international carriers that can
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