Vodafone pledges $1 billion Indian investment to expand 3G

Details: James Barton; Category: Investment; 07 October 2014; 7632 views

Vodafone CEO Marten Pieters has stated that the UK-headquartered group will spend $1 billion on upgrading its network and operations across India.

The investment is part of the group’s Project Spring, an initiative predominantly aimed at boosting 4G in Europe and 3G in emerging markets. The group believes that promoting data services will boost revenue growth in India, and is financing the initiative using funds from the sale of its stake in Verizon Wireless.

“It’s all about data,” said Pieters. “That’s the most exciting thing we see. If the customer gives me $2 or $3 a month, it’s very difficult for me to build a good network, where in the rest of the world they get $20, $40, or even $60 or $80 in the U.S.”

Pieters clearly acknowledges the difficulties of justifying such an investment in a low ARPU market which has seen numerous setbacks with spectrum allocation. However, he underlined the group’s goal of expanding 3G to every telecom circle in India within 2 years, with a 4G test lined up for 2015.

Vodafone clearly considers India a key growth market due to its increasing service revenue, which grew by 10% last year. In contrast, its European service revenue dropped by 9%.