Vodafone Italy Gives Local Business FMC Market Big Punch with Rete Unica

| November 19, 2007 | Business Telecom Services - Europe, Enterprise Mobility - Europe | Competitive Intelligence Report

| Analyst: Joel Stradling

Current Perspective: Positive/Neutral
Vendor Importance: High
Market Impact: High

Event

On November 15th Vodafone Italy announced Rete Unica integrated fixed-line and mobile telephony and DSL-based broadband for businesses. The operator's NGN takes over switchboard roles to give the choice of using a mobile handset or office fixed-line on a single company extension number. A special voice tariff is applied to calls within the office from mobile phones. Rete Unica offers customers voice and data services from a single vendor with simplified billing.

Analytical Summary

• Current Perspective: Slightly positive on Vodafone Italy’s launch of Rete Unica, because the company is the first operator to launch intelligent-network switchboard functionality into the SME and large enterprise segment. The single assigned company extension number provided for use on either mobile phones or a fixed-line office phone is a potential point of differentiation. Furthermore, Vodafone Italy is offering a suite of fixed and mobile telephony product plus broadband from a single point of contact, with simplified billing and invoicing.

• Vendor Importance: High to Vodafone Italy’s FMC strategy, because the company needs to move aggressively with integrated fixed-mobile and broadband service bundles to remain competitive against primary rival Telecom Italia. This move is also the natural evolution and extension of 'Vodafone Casa' for consumers taking the product across segments into the business space. Vodafone must take advantage of a powerful and established wireless services business to complement and enhance its relatively new fixed-line direction.

• Market Impact: High on the Italian FMC market for businesses, because Vodafone Italy is raising the pressure on competitors by bringing out unique selling points (e.g., using a single intelligent NGN to give fixed/wireless handset flexibility using the same single extension number). Italian end-users have more choices than ever and will be interested in benefiting from being able to use either their wireless handsets or desk-based office phones for making and receiving calls to the same number either on the move or while stationary at the desk.

Recommended Competitor Actions

• Competitors need to call into question the presence of real fixed-mobile convergence in the Rete Unica offer. The product still calls for separate fixed and mobile handsets, and the fixed broadband access side of the portfolio has little to do with real voice/data/video convergence, as mobile handsets will continue to work over traditional wireless networks, and fixed phones over the fixed network.

• Italian service providers should also highlight their managed mobility and mobile data offerings, and making use of MVNOs (except of course Telecom Italia that has a mobile operation) to counter Vodafone Italy. Established fixed-line players COLT Telecom, BT Italy and FastWeb, need to adopt wireless strategies looking to combine ICT support for the integration of applications for use of any device over multiple access network types (i.e., Ethernet access, DSL, fibre, leased line, WiFi and 3G/GSM).

• Telecom Italia needs to look at an aggressive R&D roadmap to export its Unica dual-mode consumer product into the corporate world. The French market has some interesting examples of business services using dual-modes for WiFi-enabled VoIP, including Orange’s ‘Business Together’ and Neuf Cegetel’s 'TWIN.' Business Together gives secured access to mailboxes, and enables reading voice messages as emails, reading faxes, VoIP calls, and access to contacts and calendar. Meanwhile Neuf Cegetel TWIN is an IMS-ready service based on Nortel iVoIP to support unified voice, messaging and multimedia communications.

Recommended End User / Customer Actions

• Italian business looking to consolidate numerous communications services to a one-vendor approach can consider Vodafone’s Rete Unica. The product is also highly compelling for end-users that would benefit from the choice of using either a fixed office phone or mobile device from a single extension number.

• However, on the downside Vodafone Italy is not at the same level as a number of other operators that are established in the traditional fixed-line data network world. Thus its business network portfolio is underweight and it does not offer competing levels of ICT support, applications management, and consistency in SLAs should be carefully examined.

• Italian businesses looking into Vodafone's Rete Unica should conduct trials to measure the level of indoor cellular voice quality within their particular work premises. A solution offering cheap mobile calls from the office zone is worthless if users discover that mobile voice quality is too poor to conduct business.

CLIENTS ONLY

Current Perspective

Competitive Positives and Concerns

Recommended Vendor Actions

| Client access - Business Telecom Services - Europe | More information
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