Vodafone 2004 Annual Report Download - page 9

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Annual Report 2004 Vodafone Group Plc
7
Contents
Page
Overview 7
Mobile Telecommunications 7
– Business strategy 7
– Geographic operations 7
Competition 7
Summary of Group mobile telecommunications businesses 8
Licences and network infrastructure 9
– Global services 10
Business integration 10
Products and services 10
Marketing and distribution 12
Industry initiatives 12
Research and development 12
– Regulation 13
Non-mobile Telecommunications 16
History and Development of the Company 16
– Acquisitions of businesses 16
– Sales of businesses 19
– Formation of Verizon Wireless 19
– Mannesmann synergies 19
Overview
Vodafone Group Plc is the world’s leading mobile telecommunications company, with a
significant presence in Europe, the United States and the Asia Pacific region through
the Company’s subsidiary undertakings, associated undertakings and investments. The
Group also has arrangements to market certain of its services, through its “Partner
Networks”scheme, in additional territories, without the need for equity investment.
The Group provides a wide range of mobile telecommunications services, including
voice and data telecommunications. The Group also has controlling interests in certain
non-mobile telecommunications businesses.
The Company’s ordinary shares are listed on the London Stock Exchange and the
Company’s American Depositary Shares (“ADSs”) are listed on the New York Stock
Exchange (“NYSE”). The Company’s ordinary shares were also listed on the Frankfurt
Stock Exchange until 23 March 2004. The Company had a total market capitalisation
of approximately £92 billion at 24 May 2004, making it the second largest company
in the Financial Times Stock Exchange 100 index, or FTSE 100, and the eleventh
largest company in the world based on market capitalisation at that date.
The Company is a public limited company incorporated in England and Wales under
registered number 1833679. Its registered office is Vodafone House, The Connection,
Newbury, Berkshire, RG14 2FN England. Its principal telephone number is
+44 (0) 1635 33251.
Mobile Telecommunications
Business strategy
As the world’s mobile telecommunications leader, the Group’s vision is to enrich
customers’ lives, helping individuals, businesses and communities to be more
connected in a mobile world.
The Group has maintained a strategy of focusing on global mobile telecommunications
and providing enhanced network coverage to allow its customers to communicate
using mobile products and services.
Whilst the customer base continues to grow, the Group’s strategy is increasingly
focused on revenue growth and margin improvement from growing usage and
providing enhanced services to the customer base.
Vodafone’s strategic roadmap seeks to achieve six key goals:
•delight our customers;
•build the best global Vodafone team;
•leverage our global scale and scope;
•expand our market boundaries;
•be a responsible business; and,
•provide superior returns to shareholders.
Geographic operations
The Company has equity interests in 26 countries, through its subsidiary undertakings,
associated undertakings and investments. Partner network arrangements extend to a
further 13 countries.
At 31 March 2004, based on the registered customers of mobile telecommunications
ventures in which it had ownership interests at that date, the Group had approximately
133.4 million customers, calculated on a proportionate basis in accordance with the
Group’s percentage interest in these ventures, and 340.1 million registered venture
customers. The table on the next page sets out a summary of the Company’s
worldwide mobile operations at 31 March 2004 and venture customer growth in the
year then ended (the “2004 financial year”).
Competition
The Group faces a high degree of competition in each of its geographic markets. It is
subject to indirect competition from providers of other telecommunications services in
the domestic markets in which it operates in addition to direct competition from other
current operators of mobile telecommunications services. Competitive pressures have
led to reductions in tariffs and other acquisition and retention initiatives and this has
helped to manage the level of customer churn.
The Group expects that competition will continue from existing operators as well as
from a number of new market entrants, including those arising following the award of
new 3G licences. The scope of this increased competition, and the extent of the
impact on the results of operations, is discussed further in “Risk Factors and Legal
Proceedings”.
A summary of the Company’s direct competitors in its markets at 31 March 2004 is
also provided in the following table.
Business Overview