Thanks to disruption caused by Covid-19, Vodafone said in its first quarter (Q1) of 2021 results that sales and commercial activity were 40% below pre-Covid-19 pandemic levels in the UK, France and Germany. Vodafone has had an expensive past few years, however. Vodafone has said its 5G strategy is based around ‘co-leadership’, whereby it will aim to match the rollout speed to the leader in each country (in the UK’s case BT Group). It has already launched 5G services in over 100 cities across the UK, as well as many more besides in over eight European countries including Germany, Italy and Spain. In fact, the UK only generates 15% of revenue and 10% of adjusted earnings, with Germany being by far its largest market following the acquisition of Liberty Global's European assets last year. Vodafone is the other major mobile network operator listed in the UK, although it is a very different company to its rival BT because it is more focused on Europe rather than the UK. In its year-end results on 31 March, the company also reported that revenues had decreased by 7% thanks to the Covid-19 pandemic. The group has said it plans to release a 7.7p dividend in this financial year – an amount that was met with lukewarm investor response.
This forced it to suspend its dividend for the first time in nearly ten years at the end of 2019. The company is having to invest billions into both full-fibre broadband and 5G, and is facing increased competition after years of being accused of holding a monopoly in the UK. 4Īlthough BT is the natural leader in the UK due to its unique position in the market, this also means it has the biggest responsibility. BT already provides 5G to over 160 towns and cities. The fact full-fibre is an enabler of 5G means BT Group does have an edge over its rivals because it has significant exposure to both, with other mobile and broadband providers having to piggy-back off its networks. It owns the largest 5G network in the country, European Economic (EE), and it owns the UK’s national broadband infrastructure, Openreach, which it still owns even if it was legally separated from the business back in 2017. BT Group is the largest player in the UK when it comes telecoms.
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