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Eurobites: Vodafone UK Hit by £4.6M Fine

Paul Rainford
10/26/2016

Also in today's EMEA regional roundup: Telenor's Q3 dented by write-downs; EC probes Czech network-sharing agreement; UK MPs examine EE's 4G emergency services contract.

  • Vodafone UK has been fined £4.6 million (US$5.6 million) by UK regulator Ofcom on two counts: for failing to top up the credit of more than 10,000 customers after the customers in question had paid for top-ups, and for failing to handle general customer complaints properly. The prepaid problem occurred because of Vodafone's migration to a new billing system, which meant that affected customers' SIM cards were left in a "pre-disconnection state" that allowed customers to pay for top-ups at cash machines and in other ways without the top-ups taking effect. Clearly the fine is not great PR for Vodafone, but it's unlikely to cause head office too much trauma in the long term. For the financial year ending March 31, Vodafone UK's revenue hit £6.17 billion ($7.53 billion), so this fine represents 0.07% of the operator's top line. To put that into perspective, it's a bit like your average UK worker being fined about £20 ($24), which is enough to upset your Friday night out but unlikely to prompt a rethink of the annual holiday plans.

  • Norway's Telenor Group (Nasdaq: TELN) has reported a 4.82 billion ($582 million) kroner loss in the third quarter, following write-downs associated with affiliate VimpelCom Ltd. (NYSE: VIP), Indian operations and other items -- this despite a 3% increase in revenues to NOK32.8 billion ($3.96 billion). Telenor has been through the mill after becoming embroiled in a bribery scandal in Uzbekistan, in which VimpelCom was implicated. (See Eurobites: 'Uzbekgate' Scandal Claims More Telenor Scalps, Eurobites: Ex-VimpelCom Boss Held Over Uzbek Deals and Eurobites: Norway Dumps Telenor Chairman.)

  • The European Commission is to investigate the network-sharing agreement struck between Telefónica O2 Czech Republic A.S. and T-Mobile Czech Republic a.s. in 2011, Reuters reports, to find out whether it restricts competition. The country's third mobile operator, Vodafone, is not party to the agreement.

  • MPs in the UK are to scrutinize plans to replace the country's dedicated emergency services network with one based on 4G after concerns were raised that such a move will be "inherently high risk," the Financial Times reports (subscription required). EE , the mobile operator now owned by BT Group plc (NYSE: BT; London: BTA), was awarded the emergency services contract last December, replacing AirWave's TETRA network, which is based on Motorola technology. (See Eurobites: EE Lands Emergency Services Deal.)

  • UK broadband provider TalkTalk is planning to acquire Sky 's equity in the joint venture -- of which CityFibre also forms a part -- that is bringing 1Gbit/s fiber to the ancient city of York. More than 2,400 customers have signed up to the service since the beginning of the year after a successful trial and now the joint venture partners plan to roll out the fiber to the rest of the city. Completion of the rollout is expected to cost £20 million ($24.4 million) during TalkTalk's financial year ending March 2018 and will be funded by TalkTalk, with CityFibre continuing as a shareholder.

    — Paul Rainford, Assistant Editor, Europe, Light Reading

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