Mobile Communications
The plans stay ambitious for the next few years: to safeguard market leadership in Austria, leverage the potential of international activities, explore further value-enhancing acquisitions
Strategic Goals
- Safeguard market leadership in Austria and fully leverage the potential of international activities
- Increase usage through innovative data service
- Explore further value-enhancing acquisitions
- Realize synergies within the segment and the Telekom Austria Group
- Continuously optimize the cost structure and improve efficiency
The Mobile Communication segment operates in Austria, Bulgaria, Belarus, Croatia, Slovenia, Liechtenstein, the Republic of Serbia and the Republic of Macedonia. These very different markets are managed taking into account regional peculiarities, while exploiting inter-segmental synergies through coordinated product development or uniform standards. This market-focused approach is also reflected in the high degree of autonomy enjoyed by the respective companies and individualized market approaches.
The segment’s flat and efficient structures support rapid decision-making processes, the transfer of knowledge through the segment-wide deployment of experts and the utilization of synergies and economies of scale for procurement and the launch of new products. In order to successfully maintain its position as a regional player in the face of international competition, the Telekom Austria Group entered into a partnership with Vodafone in 2003, which does not entail any equity investment by either company.
Eastern and southeastern Europe remains the prime target region for the expansion strategy. In addition to the acquisition of MDC in Belarus, operations were successfully launched in the Republic of Serbia and the Republic of Macedonia in the year under review. Efforts to enter the market in the Republic of Bosnia and Herzegovina will be continued.
The segment pursues a three-pronged strategic approach:
- A value-oriented acquisition policy focusing on attractive markets in eastern and southeastern Europe to safeguard cash flow growth.
- Increasing operating results remains the prime objective when integrating new companies. Tried-and-tested standards are implemented at these companies, although due consideration is given to local conditions.
- Product innovations and a target-group-oriented market approach are used to manage market shares. A multi-brand strategy should permit a differentiated approach when addressing specific customer segments, especially in markets with a high penetration rate. At the same time, an optimal combination of excellent network quality and selected product innovations such as HSUPA, NFC, mobile television, voice over IP or the expanded Vodafone live! product portfolio guarantees high levels of customer satisfaction. It is also essential to continuously improve efficiency and effectiveness and thus profitability by consistently optimizing cost structures and pursuing a prudent investment strategy.
Two other expansion projects also confirm the Telekom Austria Group’s pioneering spirit and rapid implementation of strategic projects. Vip mobile in the Republic of Serbia commenced operations after only six months. First of all a prepaid offer was introduced, followed only three and a half months later by contract customer products. In the business customer area Vip mobile became the first operator in the country to introduce BlackBerry services.
In the Republic of Macedonia, Vip operator introduced a prepaid service within only six months, immediately stimulating competition; contract-customer products were already available seven weeks after operations had been launched. Both operators have therefore been able to comply with the license requirements and achieve a rapid market launch. The next measures will focus on successfully servicing the market, local regulation as the framework for fair competition and on expanding the company’s own infrastructure.
