New research from PriMetrica’s GlobalComms highlights how two of the world’s largest mobile players – Vodafone and Orange – have adopted differing strategies in their efforts to exploit the revenue potential that exists in diverse markets around the globe. Vodafone entered the Icelandic mobile market in April 2003, forging a network partner agreement with leading private operator Islandssimi, in a move that allowed the UK giant to effectively side-step the problem of having to inject significant cash resources into what is a small, highly competitive sector with limited potential for subscriber growth and high saturation levels; by the end of 2003 cellular penetration had reached 95.9% with 278,000 people already signed up to mobile services. Islandssimi, which was immediately rebranded Og Vodafone, will not only benefit from the UK-based parent’s financial and marketing clout, but also from the numerous roaming agreements it has in place across the globe and from other technological advantages. Vodafone, which has similar agreements in place with operators in Austria, Croatia, Denmark, Estonia, Finland, Kuwait and Slovenia, will look to introduce 2.5G data services such as Vodafone Live! without having to contend with the threat of high investor risk.
In contrast to its icy counterpart, the Dominican Republic is proving to be a hotbed of activity. The popularity of mobile services has blossomed in recent years with cellular penetration rising from just 1.1% in 1996 (82,547 users), to 23.4% or 1.945 million of the population by end-September 2003. Moreover, recent yearly growth rates of 71.5%, 47.9%, 102.7%, 66.2% and 80% have attracted the interest of international players – albeit at a cost. Orange launched a GSM-900 service through its local unit, Orange Dominicana, in November 2000 and by 31 December 2002 had attracted 433,058 active customers. Nine months later this figure had risen to an estimated 503,000, a market share of 25.85%, with strong indications of high growth to come in 2004. Indeed to back this up, in March 2003 the International Finance Corporation, the private sector financing arm of the World Bank, and the Banco Popular Dominicano agreed to provide Orange Dominicana with USD130 million in order to develop and expand its GSM network. Its infrastructure currently covers only 88% of the population, and it also has to contend with Verizon-backed Codetel, recently rebranded under the Verizon banner, which dominates the domestic mobile sector with over 900,000 subscribers – a market share of around 46.5%.