Vodafone. The following report consists of The goods and services provided by Vodafone, The dynamics of Vodafones business with the help of Porters Five Forces, The current position and potential of Vodafone by SWOT

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EXECUTIVE SUMMARY

Vodafone Group Plc is the world's leading mobile telecommunications company, with a significant presence in Europe, the Middle East, Africa, Asia Pacific and the United States through the Company's subsidiary undertakings, joint ventures, associated undertakings and investments.

The Group's mobile subsidiaries operate under the brand name 'Vodafone'. In the United States the Group's associated undertaking operates as Verizon Wireless. During the last two financial years, the Group has also entered into arrangements with network operators in countries where the Group does not hold an equity stake. Under the terms of these Partner Network Agreements, the Group and its partner networks co-operate in the development and marketing of global services under dual brand logos.

At 30 June 2007, based on the registered customers of mobile telecommunications ventures in which it had ownership interests at that date, the Group had 232 million customers, excluding paging customers, calculated on a proportionate basis in accordance with the Company's percentage interest in these ventures.

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. The Company had a total market capitalization of approximately £88 billion at 3 July 2007.

Vodafone Group Plc is a public limited company incorporated in England under registered number 1833679. Its registered office is Vodafone House, The Connection, Newbury, Berkshire, RG14 2FN, England.

(www.vodafone.com)

The following report consists of

* The goods and services provided by Vodafone,

* The dynamics of Vodafone's business with the help of Porter's Five Forces,

* The current position and potential of Vodafone by SWOT analysis,

* The Supply chain of Vodafone,

* The security and legal issues of Vodafone,

* The research and development carried out by Vodafone,

* The information technology used by Vodafone.

BUSINESS BACKGROUND

GOODS AND SERVICES OF VODAFONE

Voice Services

Revenue from voice services makes up the largest portion of the Group's turnover and the Group is undertaking a wide range of activities to encourage growth in the usage of these services. In increasingly competitive local markets where value for money is an important consideration, improving use of existing products and developing a range of new offerings for customers has helped the Group to continue to grow its total voice revenue. Pricing is an important factor for customers choosing a mobile phone network and is also important in encouraging usage of services whilst maximising revenue and margins. Two main pricing models exist in the mobile market - contract and prepaid. Contract customers are usually governed by a written contract and credit facilities are granted to them to enable access to mobile network services. In most cases contracts have a term of 12 to 24 months with monthly payments for services and, in many of the Group's mobile operating subsidiaries, the option of purchasing a subsidized handset. A prepaid customer pays in advance in order to gain access to voice and other services. The take-up of these models in the markets in which the Group operates varies significantly, from Japan and the US, where the vast majority of customers are on contract plans, to Italy, where the market is predominantly prepaid. (Vodafone Annual Report 2005)

Social Products

In 2005 work continued on making mobile services more accessible to people with special communication needs. This includes a product that converts text to speech, known in English speaking markets as Vodafone Speaking Phone, which is now available in six markets. This gives users who are blind or visually impaired access to all handset features, including text messaging. (Vodafone Annual Report 2007)

Non-voice Services

Messaging Services

All of the Group's mobile operating subsidiaries offer a short message service, which allows customers to send and receive text messages using mobile handsets and various other devices. The multimedia messaging services ("MMS"), which offer customers the ability to send and receive multiple media, such as pictures, music, sound, video and text, to other compatible phones, are also available in all Group mobile operating subsidiaries, with the exception of Albania. (Vodafone Annual Report 2005)

Vodafone Mobile Connect data cards

The Vodafone Mobile Connect data card provides working mobility to customers accessing email and company applications with access speeds up to 384 kilobits per second when connected to a 3G network. The Vodafone Mobile Connect 3G/GPRS data card has now been rolled out across 17 markets, including the Group's associated undertakings in France, Belgium and South Africa and the Group's Partner Network operators in Austria, Bahrain and Finland. The product portfolio was enhanced in the financial year with the launch of a quad-band data card allowing customers to connect whilst travelling in the US and a data card supporting both GPRS and EDGE technology which provides high speed connectivity in a number of the Group's Partner Networks. Vodafone Mobile Connect data cards are available in an increasing number of distribution channels and with a growing range of service and price bundles. (Vodafone Annual Report 2007)

PORTER'S FIVE FORCES

. Barriers to Entry

(a) Economies of Scale - Moderate

The mobile phone companies were expanding internationally at a fast pace, but the potential benefits of economies of scale in R&D and network exploitation remained unclear. Mobile phone manufacturers did enjoy great economies of scale in production, marketing and R&D, which allowed the three major producers to dominate the industry and sustain a competitive advantage. Strategic alliances with these producers would allow the major mobile phone operators to share in these economies, to lower costs for both companies and to minimize the threat of new entrants.

(b) Product Differentiation - Low

There was no evidence that mobile phone operators achieved product differentiation. In fact, mobile phone manufacturing brands were more important to consumers than those of the mobile phone operators. As a result, mobile phone operator product differentiation could only be successful if in conjunction with the major phone manufacturer brands. The multimedia content of mobile phone operators could prove to be a successful strategy for product differentiation in the future.

(c) Capital Requirements - High

Compared to capital requirements of the telecommunications industry as a whole, the mobile phone industry capital requirements were low. However, within the mobile phone industry, capital requirements present a significant barrier to entry. Because spectrum licenses went up for auction, only the most financially fit and liquid mobile phone operators could acquire these essential components of their business strategy. One method of negating these stiff capital requirements within the mobile phone industry was to acquire or form alliances with existing operators in other countries. These arrangements took shape through the use of roaming agreements, allowing one operator's customers to use their allies' network when their own was unavailable.

(d) Switching Costs - Low

Because product differentiation is low between the mobile phone operators, switching costs are bound to be low. If multimedia content becomes a major opportunity for product differentiation as is expected, this could raise the switching costs for customers.

Switching costs could also be higher if mobile phone operators and manufacturers decided to create and operate equipment that was not compatible across mobile phone operators. This seems unlikely, as it would also reduce the ability of mobile phone operators to put in place roaming agreements with their allies.

(e) Access to Distribution Channels - Low

European regulations governed distribution channels through the use of spectrum licenses. This policy of auctioning licenses to mobile phone operators should be considered a strong barrier to new entrants.

(f) Government Policy - Low

Government controls the entry into the mobile phone industry through their spectrum licenses. Deregulation would pose a significant threat to existing mobile phone operators, but does not seem to have been on the horizon. (www.cybozone.com)

2. Bargaining Power of Suppliers

Mobile phone manufacturers are the primary supplier to the mobile phone operator market. These manufacturers were dominated by Ericsson, Nokia, and Motorola with 61 percent of the market. Because the mobile phone manufacturing brands were more important to consumers than the mobile phone operators themselves, bargaining power of suppliers was high. Industry firms are not a significant customer for the supplier group because the suppliers operate in far more international locations and markets than the mobile phone operators. Suppliers' goods are critical to buyers' marketplace success. Mobile phone manufacturers could integrate forward into the industry. These suppliers were credible, having substantial resource and provide a highly differentiated product. (www.cybozone.com)

3. Bargaining Power of Buyers

There was very little differentiation among mobile phone operators, and the switching costs are low. Accordingly, the industry firms battle for higher quality, greater levels of service, and lower prices than their competitors, and the consumers benefit. Mobile phone customers purchase the entire portion of the mobile phone operator's industry output. The sales of the mobile phone service account for the entire amount of the seller's annual revenues. The mobile phone customers could switch to another mobile phone operator at little, if any, cost. The mobile phone industry's products are undifferentiated and standardized. The buyers do not pose a credible threat of backward integration because of the high capital requirements. (www.cybozone.com)
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4. Threat of Substitutes

Substitute products for the mobile phone industry could be considered fixed-line phone products if convergence is not considered to exist. This substitute product's price is not lower, and its quality and performance capabilities are negligible compared to mobile phone products. Switching costs are low but the advantage goes to the mobile phone industry because there is a greater chance of switching to mobile phones from fixed-line phones than the other way around. (www.cybozone.com)

5. Degree of Rivalry

(a) Numerous or Equally Balanced Competitors - High

There are many equally balanced ...

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