Vodafone Japan to open network

Vodafone on Tuesday put more flesh on the recovery strategy for its troubled Japanese operation when it admitted it was prepared to open up its network to new entrants.

It will consider hosting so-called virtual network operators as part of a move to target specific market segments. The world's largest mobile phone operator has so far been very selective in letting potential rivals on to its networks around the world, although it recently signed a deal with Extreme Sports in the UK. The change of direction was revealed on Tuesday by Bill Morrow, the former head of the UK business, who was parachuted into the troubled subsidiary three months ago as part of a management shake-up.

Mr Morrow also said the group would be open to considering other access technologies beyond the current mobile platforms, including the nascent Wi-Max technology, which offers broadband coverage over a much wider area than the current Wi-Fi technology.

But analysts were disappointed by a lack of further detail from Vodafone.

“If this is interpreted positively, Vodafone is preparing to launch some very innovative new services. But if this is interpreted negatively, it looks like they don't have anything concrete to announce,” says Tetsuro Tsusaka, telecoms analyst at Deutsche Securities in Tokyo.

The change in strategy comes as Vodafone's Japanese unit has fallen behind the competition.

Last month Vodafone increased net subscribers for the first time in 6 months. However, it made a net gain of just 5,300, compared with a net increase of 176,000 for DoCoMo and 160,000 for KDDI.

“With the potential of new mobile licences [in Japan] they have got to get their act together quickly,” said Nathan Ramler, telecoms analyst at Macquarie Securities in Tokyo.