After the finalization of $130 billion deal with Verizon, Vodafone is planning to boost up their investment in broadband and other mobile networks that could increase the spending of European competitors and even prompt making some more deals.
The owners of Vodafone are now planning to further raise their capital expenditure 6 billion pounds ($9 billion) under its new project known as “Project Spring”. Vodafone is one of the best mobile phone companies that are providing network quality over three years for the customers of Europe and emerging markets such as India and South Africa.
With the advancement in technology people in the emerging markets are turning towards smartphones, tablets and other devices. It means providing good quality is more essential in the fight to win the trust of the customers. By keeping that in mind, Vodafone has decided to sell 45% stake in Verizon Wireless. But the bulk of the windfall – $84 billion – will be given to shareholders and the rest used to pay the debt. According to the CEO of Vodafone, many mobile companies are now looking to follow the example as set by the company in increasing the spending on their networks.
“With the advent of 4G, there is a window for number one or two players in each market to spring ahead and put more space between us and smaller players,” he said recently. “The operators with bigger shoulders will follow us, while the smaller ones or the ones who are more financially constrained may not be able to.”
Telefonica in Spain, Germany, and Britain and Telecom Italia in Italy are getting much pressure from a stronger Vodafone. Both the groups are under high level of debt that they are trying to pay for months. The mobile networks of Europe and elsewhere will get almost half of the money from Project Spring said by Vodafone. Vodafone is working continuously on expanding its 4G service to more than 90% of the customers by the year 2017, in five main European markets including Germany, Britain, Italy, Spain and the Netherlands.
The services of the business will almost need a quarter of the cash. These services include, cloud computing, improving its stores, both bricks and mortar and online, and on advancing the customer support systems, according to the company.
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