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Vodafone Oz slims down as customers flee

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Vodafone Australia is to shed an estimated 500 staff as it continues to leak customers and struggle with network quality issues.

Following a detailed business review and the loss of 178,000 customers in the six months to July, Vodafone CEO Bill Morrow said that the company was “prepared to think and act differently in everything we do.”

The carrier announced streamlining of senior management, commitment to improved network infrastructure and servicing and a consolidation of costs centred around job cuts.

Its key management move was to tap former Vodafone New Zealand CFO Jim Marsh as replacement for departing Vodafone Australia CFO David Boorman. Brad Whitcomb has been appointed to take care of strategy, "transformation" and business development, while Kim Clark will now head up the consumer business unit.

Vodafone announced that it is poised to complete the first phase of a $AU1.7 billion network upgrade, which includes 3G+ (DC-HSPA+) protocols and a swap out of nearly all radio equipment.

The carrier said the new network would result in increased download speeds up to 8 megabits per second on 60 percent of its network, improved 3G data session and call set-up rates, and reduce call drop outs by one third in metro areas. It also wants first-call customer care resolution rates improved by almost one-third in the company's call centres.

While Morrow said that there was a 50 percent reduction in complaints to the Telecommunications Industry Ombudsman and a reduction in network-related complaints he conceded that “more needs to be done."

According to the TIO, Vodafone maintained its popularity among complainants with an 11 percent rise, but for different reasons. While network outage issues were the main gripe for 2010-11, it is now mobile charges that are of concern with users. The TIO reported that VHA forked out $AU10 million in charges, up from $AU7 million the previous year.

“We know we are not there yet. Only hard work, further investment and an acute focus will deliver what is needed in this market,” he said.

The elimination of “non essential costs” would stem from job cuts in office roles nationally in addition to “customer touch points” and a reduction in the carrier’s customer support processes.

“We need to prioritise every dollar and internal action to count toward an improved customer experience and these changes are designed to deliver just this,” Morrow said.

On the other side of the Tasman, Vodafone New Zealand has cleared the regulatory hurdles to take over Telstra's Kiwi subsidiary, Telstra Clear. However, it has pulled some of Telstra Clear's spectrum holdings out of the deal, meaning that Telstra will have to find another buyer. ®

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