Vodafone Confident Of U.K. Turnaround

By Simon Zekaria

LONDON--Vodafone Group PLC said Tuesday it is confident it will turn around the fortunes of its business in the U.K., which has seen low profitability under stiff competition.

Vodafone's U.K. Chief Executive Jeroen Hoencamp said he expects to return the business to growth, in both profit and revenue terms, in the next 18 to 24 months.

"I am very confident," said Mr. Hoencamp. "We can turn it around."

Vodafone, which also has a significant enterprise business in the country, provides mobile services in the U.K., competing with EE--a mobile joint venture between Orange SA and Deutsche Telekom AG, Telefonica's O2 and Hutchison Whampoa's Three.

Vodafone, the world's second-largest mobile operator by number of subscribers after China Mobile Inc., is building out its network and rolling out new stores in the U.K. to win more subscribers.

Vodafone also says it is ready to compete in the U.K.'s developing "quad-play" consumer space of mobile, fixed-line telephony, broadband and television services, even if it says the market isn't developed yet.

Vodafone has "not seen real evidence" of developed quad-play in the market, said Mr. Hoencamp.

Other operators like satellite giant British Sky Broadcasting Group PLC and the U.K.'s telecom incumbent BT Group PLC currently offer "triple-play" consumer services, but not mobile. Liberty Global's Virgin Media does compete in each of the four spaces.

BT plans to offer a consumer mobile service as part of a bundled package of its other products by April next year.

Vodafone has spent billions of dollars on fixed-line cable assets in Germany and Spain to ramp up its quad-play strategy in those markets as it seeks to shore up flagging wireless operations.

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