The choice to invest in 4G rather than Wi-Fi was a “no-brainer” as there was no comparison between the two technologies, the chief executive officer of Vodafone Malta Amanda Nelson said.
“Nowhere in the Vodafone Group have we implemented Wi-Fi, and for very good reasons.
“4G is extremely high speed, between two and 10 times faster than public Wi-Fi according to our measurements.
“People think about home Wi-Fi which is shared with just a few people and which is relatively secure. It is very different with public Wi-Fi, which is not always secure. There is no password and since you cannot control how many people are going to be using it at any point in time, the oper-ators cannot give any kind of guarantee on speed.
“Of course, the closer you are to where the Wi-Fi is transmitted, the better the signal, as with any technology, but the difference is more extreme with Wi-Fi than with mobile,” she said, adding that for people on the move, the experience with Wi-Fi was not as seamless as it would be for mobile.
Vodafone realised it had to act fast to ensure that the (4G) service did not get a bad name when people received their bills
“Another thing that people overlook is that when you open up people’s home Wi-Fi to public use, you are still using their electricity! I don’t think anyone has ever asked for their permission as it is all in the terms and conditions!”
Vodafone Malta introduced 4G 18 months ago and is still the only operator offering the service – at present covering 70 per cent of the country.
“I can assure you that it is the right 70 per cent,” she smiled, noting that the most densely populated areas had been covered.
“I cannot tell you exactly when the remaining 30 per cent will be covered, as that is commercially sensitive, but we will be going for 100 per cent nationwide coverage.”
The shift to 4G took many by surprise as the quantum shift in speed – five to 10 times faster than 3G – meant they could consume considerably more data – even though they may have been browsing for the same length of time.
“For example, You Tube videos load faster, so you can watch more of them,” she explained.
This generated a number of complaints when people received their bills, but Vodafone realised that it had to act fast to ensure that the service did not get a bad name.
“People are afraid of bill shock with data, much more so than with voice where they know what a call will cost. However, the reality is that 90 per cent or more of those who use 4G are within their bundles and were not paying anything extra. We do appreciate that if you make data easier for customers to use you need to adapt your pricing and way of charging for it.
“We have seen data growing not just this year but also in previous years, including with 3G, and we have been adapting as we went along,” she said.
Vodafone Malta tackled the issue in four ways: lower rates; notifications about usage; larger allowances for business users; and an educational campaign.
It introduced 80 per cent lower rates for out-of-bundle usage of just €2 for 100MB – a few days’ worth for the average user – and whereas before notifications were sent only when people had reached 80 per cent and then 100 per cent of their usage, they are now being sent one after each €10 extra has been run up.
“While we were developing the automated notifications, we were actually calling people if they were coming to the end of their bundle, and adjusting their pricing manually,” she said.
For heavy users they also brought out large add-on bundles, while the Red business tariffs also include hefty data allowances: the Red Premium allows 5GB of data and the Enterprise tariffs up to 8GB.
Ivan Zammit, the head of the Enterprise Business Unit, said business models were changing. “There has been a tremendous shift in the way businesses use fast mobile networks to mobilise their workforce and increase productivity – as well as making sure that customer care can also be given outside normal working hours. Apart from this, mobility gives employees flexibility in terms of work-life balance.”
The education campaign is also very important, as many people are not really aware of their data usage, especially when it comes to social media. For example, Facebook videos play automatically unless the phone settings are changed, and some apps also use high-definition video as a default. Even with Whats App, there is a great difference in data usage between text, photos and videos.
“This has been part of our Relax campaign. Our radio ads, brochures and website explain what you can do with 100MB and of course our staff in stores are also there to help,” he said.
The changes to pricing do not apply only to 4G data: there has also been a massive reduction over the years in roaming, much of it under pressure from the European Commission. However, Ms Nelson said that some of the initiatives went beyond what had been mandated.
“We offer a very low rate for roaming – not only to the EU but also a cluster of other countries where Vodafone is present, such as Australia, Egypt and so on. We also have a daily rate of €1.50 if you are in the UK or Italy. Unfortunately, there are some countries where we cannot charge a low fee as the cost to us is very high.”
We have been over-investing for a few years to get 4G, and the level of investment will not drop back. I can tell you that network improvements are our top priority
Europe is still not satisfied with the significant decrease in roaming tariffs, and there is still debate on whether the way forward will be a full ‘take your home tariff abroad’ approach or a daily allowance, although Ms Nelson believes the former is unlikely.
“The reality is that our premium tariffs have really large roaming and international calling bundles so that they are worry-free for our very-high-value customers. But there are also many people who only need roaming once or twice a year who would not want to pay extra every month, which is why we believe in the daily rates,” she said.
Ms Nelson admitted that the roll-out of 4G had used up more than the company’s normal annual investment, but the Vodafone Group had made a two-year global investment of billions of euro which Malta was still tapping into.
“We have been over-investing for a few years to get 4G, and the level of investment will not drop back. I can tell you that network improvements are our top priority – though I cannot disclose what and when. I can tell you that IT and improving the customer experience are right up there too, around billing and online.
“Another investment you will have seen this year is on the retail experience. Our new destination store in Birkirkara, with its very different look and feel, will remain the key destination store for us. We are also going to be investing in other retail outlets,” she said.
Another investment which has proved to be very popular is the free upgrade to high definition for Vodafone to Vodafone voice calls – for those with the appropriate handsets – which now account for one in every five calls.
“We have already had four million calls on HD Voice and since we recently also rolled it out to our 4G customers, use will grow dramatically. Customers notice the difference immediately as there is no background noise when you are speaking, which is especially good when you are in a busy place,” she said.
Vodafone may already have an investment plan, but things change constantly. Recently, for example, the Malta Communications Authority launched a consultation paper on the wholesale access to Go’s planned fibre-to-the-home network. Would it interest Vodafone?
“Yes, it would interest us. If you look at our strategy in Europe, Vodafone is moving from being a mobile-only operator and fibre is the most future-proof technology. So yes, we would always look at opportunities, although I cannot guarantee or commit.”
Vodafone already uses fibre to provide telephony and broadband connectivity to offices and large business, Mr Zammit explained.
Ms Nelson added that Malta “absolutely” needs an FTTH network as cable would not be enough to cope with customer needs – but that Go could not shoulder the burden alone.
“I believe that the best way to go about this would be to have a network with fair access. Otherwise it would probably not happen fast enough as you would need more than one operator to justify building the network. We would also need a lot of government support because of the practicalities of building that sort of infrastructure in Malta. That would be our position: do it once; have some kind of independent infrastructure provider; and then compete on service,” she said.