Vodafail. Let my people go!

According to this piece from the Sydney Morning Herald Vodafone has themselves a big problem.

Vodafone exodus: 375k customers leave this year

Their numbers look pretty ugly for the second half of last year they booked nearly $18 million in profit. This year they’re showing a loss for the same period of just over $78 million.

That performance is nearly as good as the reception on their network.

Losing 375,000 customers in 6 months averages out to be around 203 customers a day. Where are they going?

According to this article from The Australian it looks like all of them and a whole lot of others are going to Telstra. The quality of their network is the key here and I think the differentiator is the backhaul capability of the Telstra network allowing it to better cope with data consuming smartphones and tablets.

Its been my experience that Optus and Vodafone really invested in voice carriage and projected growth in voice carriage and were caught ‘wrong-footed’ when these types of devices exploded onto the market.

That being said Telstra did their level best to screw every user of mobile data by charging, what seemed like, more per MByte than the current spot rate for gold.

This is where market segmentation really came into play. Vodafone was pitching for the low end of the market, but, these customers were also more likely to upgrade handsets to the latest gadget and roll over their contracts early.

When the iPhone hit, no one expected the explosion in the growth of mobile data consumption and when the rest of the smartphones really hit the market the wheels fell off.

Will Vodafone manage to get their act together and stop the arterial haemorrhage of paying customers? I really don’t know but if this doesn’t get fixed really quickly they could be in a lot of trouble given their capital commitments for network expansion. In fact we’ve been here once before, they were called One-Tel.