Cutting Room: Vodafone’s ‘poor’ argument


Vodafone’s statement last week attacking Ofcom’s proposal to cut mobile termination rates from 4.3 pence a minute to 0.5 pence a minute by 2015 stretches credibility

By Ian White (contact

In its rebuttal of Ofcom’s proposal fopr reduced mobile termination rates (MTRs), Vodafone claims to set out: “why over four million mobile users would disconnect their mobile phones as a result of termination rates falling as low as 0.5p per minute.”

It says: “2.6 million of these users do not spend more than £10 a month on their mobile telephony… they are disproportionately D and E in socio-economic terms and very few of them have multiple SIM cards.

“It (Ofcom) should consider introducing measures like a vouchers scheme or a subsidised tariff in order to protect vulnerable users… it is important that the most vulnerable in our society are protected.” Etc, etc.

Is Vodafone really suggesting that a mobile phone is now as essential to life as heat, fuel, food, clothing and medical care?

It stretches credibility to hear Vodafone expressing its concern for the ‘vulnerable’ (that catch-all word for any politician tugging at the heart strings).

When did we get to the stage where the meek shall inherit an iPhone, a Desire, an N97, a Milestone etc?

Since when is ownership of a device once regarded as an expensive City Boy toy the birthright of every individual?

Actually, I understand Vodafone for lobbying with this ludicrous theory.
Vodafone’s PR team are fairly clued-up media manipulators. They know that journalism is now led by headlines and search engine optimisation and emotive tags to drive traffic to websites.

Hence any story with the words ‘vulnerable’, ‘society’, ‘mobile’ and ‘phone’ racks up the hits and sells newspapers.

Apparently one of the Vodafone justifications for ensuring the lower socio-economic order were not priced out of the mobile market was to ensure that families could stay in touch.

Judging by the numerous accounts of bullying-by-text, happy slapping,  the use of mobiles to organise gang activities, depriving some of the underclass of their handsets would be no bad thing.

There are as many in Vodafone’s ‘vulnerable’ ranks who use their mobiles more for mischief-making than staying in touch with Granny.

Let’s be clear. Vodafone’s concern is not so much about the welfare of the D and E-class as about the risk of losing customers and revenues.
The only ‘vulnerable’ aspect of the Ofcom termination rate controversy is Vodafone’s market position. Especially since it was knocked into third place by the merger of Orange and T-Mobile.

And if termination rates mean some subscriber revenues drop? Well, operators will react to the cut in termination rates with a new tariff innovation for the sector.

The poor will not give up their mobiles, any more than they will their Sky satellite dishes. Vodafone will find a way to balance the books. It always has and it always will.

Forget the smokescreen about the ‘poor’. Vodafone wants an end to regulatory intervention that will inhibit cashflow to invest in 4G.
It must know that, as long as anyone can walk into Tesco and buy a mobile phone for £10, even the poorest in society will find a fiver for a top-up.

After all, they’ll still have their benefit cheques.