Ray Le Maistre, TelecomTV (00:05):
So we're at FutureNet World in London. I'm here with Andrea Dona, he is Chief Network Officer at Vodafone UK. Andrea, thanks for joining us again today. Good to see you.

Andrea Dona, Vodafone (00:14):
Good to see you, Ray.

Ray Le Maistre, TelecomTV (00:16):
So could you just give us an update on where Vodafone UK is in terms of its 5G rollout, not only in terms of the capacity and the reach of it, but also in terms of where you are with 5G standalone.

Andrea Dona, Vodafone (00:31):
Yeah, so we started our 5G journey back in 2019. As you know Ray, we launched with a clear ambition to build 5G, right? We weren't going to compromise on the quality of the 5G. That was also as a result of acknowledging that we had a certain amount of money we could dedicate to our 5G rollout. It's an expensive rollout, it's a capital intensive rollout, and so we had to stretch the money. We got to the maximum, so we decided to put 64 by 64 massive vinyl on all our 5G and put it where it matters most, where the customers need that superior throughput and the superior speed, but also to provide an efficient route to expanding for the 4G. We've got sites today that are run out of capacity on the 4G, 5G gives us a really economic leg to be able to expand it.

(01:29)
It's also very efficient for one terabyte of data transported on 3G, which we switched off. We switched off 3G very successfully. At the end of February, we are only spending 7% of energy on 5G to transport the same amount of and in an energy crisis and with a cost crisis with an inflation pressure, we have to bring 5G. That gives us that economic way of providing for our customers and giving that additional capacity. So we are putting it where it matters. I'd love being frank with you. I'd love to put it in much more places. That's what we believe the merger is going to do for us. The merger, proposed merger is going to give us the scale to be able to reach out to much more population, more regions in the UK and not risk being marginalized and regionalized and only being able to invest and not really unlock the true potential that 5G can bring to the UK market, which is 5 billion pounds.

(02:32)
In terms of economic growth, if we're able to bring 5G on sa, we went first. We launched first because we wanted to unlock the true inherent value and capability that's in 5G. Five Gs A is the true 5G. It's not only about speed, it's about more capacity. It's a better energy efficiency, better life on your mobile battery and also unlock those new 5G use cases because it brings latency less than 10 milliseconds. And so it's true the inherent value of 5G is brought to life With 5G SA, we want to be the first so that we can unlock some of the use cases like what I explained earlier in the King's coronation, we used a 5G essay slide for broadcasting and we also need to acknowledge that the transition between NSA non-ST standalone 5G and SA is a tricky transition and you need to get it right because the roadmap roadmap or SA is lagging behind the NSA and you don't want to dip in customer experience when migrating from N-S-H-S-A.

Ray Le Maistre, TelecomTV (03:46):
Okay. So you mentioned a few things then just to clarify, the merger you referenced, that's the merger between Vodafone UK and free UK just for some of our international viewers. Now, slicing being talked about for years, for some people slicing was a bit of a red herring, but now we're starting to hear about actual UK use cases, but mostly in specific verticals. So broadcast appears to be a bit of a low hanging fruit for slicing. Is there going to be a use case do you think, for network slicing across lots of verticals and even in the consumer market?

Andrea Dona, Vodafone (04:26):
I think so. I absolutely think so. You talk about low hanging fruit in the broadcasting industry, I think they were the first, they are the first broadcasting vertical is the first adjacent industry that understood the benefit that 5G SA slicing can bring, reduce cost to market, much more agile deployment of their cameras, much more the opportunity to go granular in terms of your broadcasting. They have to make choices. Do they go for the big events or they can actually afford to go to the niche events? They embrace that. They looked at the opportunity and embraced the technology to be able to do that and we proved with the king's coronation that we can deliver the promise that that technology brings. Even in really stressful and important events like that, we've got now a blueprint where we've got the industry to understand the benefit. At the same time we've experimented with our ecosystem bringing different companies in the King's coronation as an example.

(05:39)
We had Vodafone, we had Live U who were the modem providers for the broadcast. You had it TN, there's a broadcasting and we had Ericsson. So we were experimenting bringing four different companies together to resolve a business problem. We also for the first time started looking at delivering beyond connectivity so we can deliver a slice on a sim now. So it also trains our business colleagues and our sales colleagues to be able to sell beyond connectivity. We can start having a conversation with your business customers on here's not just a SIM or just a connection. Here is a slice on a SIM that enables you quality on demand, quality guaranteed quality of service and minimum quality on the uplink, like the broadcasting industry, they wanted 10 updates on the uplink guaranteed during congested periods of the broadcast. We deliver that. So we've got now a blueprint that we can replicate for other verticals.

(06:40)
You can expand it to industry manufacturing, you can expand it to gaming. What if I have a button I can select on my phone when I'm about to game and I need that consistent latency. When you want to game, I'm not a gamer, but I hear it's all about consistent latency. It's not the best latency but the consistent. Having that guaranteed latency and you pay for it, I want to play a game. I'm going to go and play it, I select it, I offer it, I get it delivered. I use it for that period of time and then I go off it.

Ray Le Maistre, TelecomTV (07:17):
Will the real power of this opportunity come to the fore? Let's assume Vodafone UK three UK come together. You've got greater reach, more spectrum, more capacity because if enterprises are going to use it and gamers are going to want to use it, they're going to be able to want to use it absolutely anywhere. Exactly.

Andrea Dona, Vodafone (07:39):
Ray, you're absolutely correct. The challenge I have today, the limitation of unlocking some of the enterprise revenue we talked about this morning is if I go to a logistics company and say I've got this great 5G SA capability I want to sell to you. I can't limit them using it only in the cities. They're a logistics company. Their trucks go to the outer Hebrides, for example. They go out to the Highlands and island. They need to have that capability today. I do not have the capital intensity to be able to invest the merger gives me the scale to do that. I will be able to deliver much more. We are planning to reinvest 11 billion of the synergies that arise from coming together as a company into the network in 10 years. Five of those ones 6 billion in the first five years. Right,

Ray Le Maistre, TelecomTV (08:31):
Okay.

Andrea Dona, Vodafone (08:32):
Where would I get that money if I don't get the merger?

Ray Le Maistre, TelecomTV (08:34):
Okay, alright, strong message there for the CMA. Absolutely. So Vodafone UK as part of the Vodafone group is obviously part of this transition that's been talked about from telco, what telecom operators used to be to TechCo a more sort of cloud oriented organization. How's that going for Vodafone UK and what does that mean for the way you are building and running your networks?

Andrea Dona, Vodafone (09:04):
We started with a very clear ambition. We would simplify to modernize. So we had three pillars. We had to radically simplify our legacy. I talked about it this morning. One of the key lessons is address your legacy head on. It's not going to go away unless you really address it. Once you start radically simplifying, you could start standardizing. Once you start standardizing, you can expose all of the inherent network functions that you want others to self-serve on and expose. So you can start generating revenue streams beyond pure connectivity and at the same time you need to modernize. I just talked about 5G SA. You need to modernize, bring the new capability. The challenge is you're having to do all three. You're having to address the legacy. You're having to standardize and you're having to invest and doing that at the scale and at the pace that that requires is a challenge. So you're constantly fighting with do I do my data center rationalization, do I do my legacy technology rationalization or do I do my new capabilities and you are constantly compromising on the two. We need a situation where I can do both at scale.

(10:30)
That would be the ideal situation. Okay,

Ray Le Maistre, TelecomTV (10:32):
So you are moving there but it's step by step sort of whatever makes sense in the immediate term.

Andrea Dona, Vodafone (10:39):
I think when we talk about telco to TechCom and beyond connectivity, I think we need to remind ourselves, and a couple of analysts and panelists talked about it this morning, must not forget, we're not forgetting connectivity, we're building on the connectivity. So we're going beyond that but not forgetting that we are the trusted partner on the connectivity front. We don't want to lose that. We want to build on that and go beyond that strong from our heritage of good connectivity providers.

Ray Le Maistre, TelecomTV (11:15):
And part of the big thing about this transition is the kind of building new in-house capabilities, developing new skills. What has that meant in your team? Have you got more developers within the team you have and how much of that is impacting the way that you are able to build, run, and then expose that network?

Andrea Dona, Vodafone (11:40):
We took a strategic decision that for certain things we need to be owners of our own destiny. We need to be the ones owning that competence because otherwise what are we? If you want to become a technology company, which we do, we need to start producing our technology now. We can't do that across the board. Partnership is important to augment, to enhance what we are trying to build internally, but we can't just give away our crown jewels. So we've done a process of insourcing of certain capabilities. So we're owners of our destinies. We're not subject to the fluctuations of the market. We can actually own it and we can also steer it in the direction we want. We are insourcing a lot of our development where it makes sense to do so and we're partnering where it makes sense to do so. You've heard me in the past Ray talk about it depends. It's a full spectrum of insourcing outsourcing depending on where we're not dogmatic in our choices. We are practical in our choices to ensure that we make the right choices.

Ray Le Maistre, TelecomTV (12:49):
So alongside that, of course you're developing your own cloud strategy and I'm not talking about offering cloud services, I'm talking about using the cloud as part of the platform that you are developing as a network operator. Can you just talk about that you have a relationship with Microsoft as part of this. How much are you building as a private cloud? How much are you building that with Microsoft? Are you using public cloud for some capabilities as well?

Andrea Dona, Vodafone (13:20):
Yeah, so you've heard that we've divested our IOT business and we've done that deliberately, consciously and strategically with the intent to say if it is a separate entity, we can provide that IOT services to all the other operators. And it's not a propriety iot platform that only Vodafone can use. We want to open it up. It's the biggest platform in the world. We want others operators to use it. But conscious of that, we need to ensure that we get access to the right ecosystem of developers to be able to create the new applications on that IOT platform that brings attract other industries, other verticals. Okay. So that's a nice partnership relationship that says I know what role I'm playing. If I look at the cloud in telco cloud, we're building our own telco cloud so that I can support my business colleagues and my consumer colleagues to turn the handle quickly.

(14:23)
If we need to react to certain propositions, certain offerings that previously would've taken a year, I can turn them around in weeks and months rather than years. So again, it's a two-pronged approach. I use my partnership with Azure and Microsoft for the IOT front, but I use my own cloud for my own internal one. I use GCP for example for my data, all my data there. I can run my data analytics on the GCP cloud and I put all my network data there. I can run data analytics on energy consumptions and identify, et cetera, et cetera. So it's a multi-part approach. What I said again this morning is choose wisely, Roy. Sorry, earlier was talking about choose your marriage. It's like choose your marriage. Absolutely. You need to be very careful on what you're choosing and then clearly define the role that you play in that relationship.

(15:30)
How deep do you go strategically? How broadly are you going with that engagement? Is it very specific on a particular subject? Fine, don't replicate it internally. You've got your partner to do that. And it can't be in my view, my personal view, you can't be a jack of all trades. So sometimes when we're talking to some of my colleagues earlier, we've all come out with press releases and you read them and they all feel the same. Everyone's doing more or less the same. Hopefully behind that news press release, there's actually very detailed engagement strategy and alignment of the strategies to say I'll do this and you do that.

Ray Le Maistre, TelecomTV (16:19):
And as part of this sort of evolution into a new platform that you can use, how does what you are doing in terms of your early open RAN moves play into that? Because this is a new kind of infrastructure, it's more IT based as that develops. Will that become part of a sort of broader IT capability that you'll be able to use in other ways as well? Not just for the ran?

Andrea Dona, Vodafone (16:48):
Completely agree. For the naysayers and for the detractive, I'm not a naysayer detractive open ran, I'm a big supportive opener. But let's take a different point of view just for the sake of being provocative. Even if you do not promote open run, surely it's a vehicle through which you can use to transform your operations. Our networks, regardless are becoming layered. Multi-vendor open and interoperable. It begs the question is that the six G world we're embracing, there won't be a new radio access technology. At least nothing's coming out of academia to suggest otherwise. So it'll be something based on the OFDM technology, all the previous GS based on a new radio access technology, C-D-M-C-D-M-A or FDM, et cetera, et cetera. If there isn't a new radio access technology coming now out of academia, you can assume that six G will be the current radio access technology.

(17:50)
With the intelligence overlay, we constantly talk about self-defining networks, some self-operating networks, automation Zero touch ide. Brilliant six G, how are you? How we going to get ready for that? Oprah ramp presents a beautiful vehicle to do so because for its very nature, it's a cloud native, cloud-based the stack that we've deployed and Vodafone is multi-vendor and it's open and interoperable and you have to have all of them working. Now it's not easy, I get it, but if you can crack it, you're ready for the new six G world. In the meantime, we are doing it to provide the much needed diversity in the ecosystem of suppliers because we need new entrants. Currently we have two major ones we can use and we need more of that optionality in the market. But if in doing so you're also preparing yourself for six G, it's a win-win.

Ray Le Maistre, TelecomTV (18:53):
And just remind us where you are in terms of the open ran rollout. You've had the cluster down in the southwest of England where you've been almost proving what is possible, but what's happening in the rest of the voter?

Andrea Dona, Vodafone (19:11):
So we've passed the proof of concept. We've met the criteria to enter into mass deployment. So we've overcome that. It's ticked all the boxes, it's met the minimum criteria in terms of performance, the radio performance, et cetera. And now it's an option on the menu. So I can choose open ran in the same way as I can choose 5G in the same way as I can choose additional carriers on 4G. So when I do my capital allocation review on a yearly basis, I can decide, well how much ran do I need to do? How much 5G do I need to do? And it's only a factor of the money I've got. I'd love to do more open ran, but because of the return on investment I have and the fact that the cost of capital is greater than my return, I only have that amount of money to spend in over. If I had more, I would do more and I swap it out faster and bring more into the market.

Ray Le Maistre, TelecomTV (20:10):
But you see this as a real learning curve, something building for the future, providing experience. Absolutely. Otherwise wouldn't be

Andrea Dona, Vodafone (20:18):
Able to get, we took the role to be our own system integrators. We're trying to stitch together Samsung, NEC, Dell Wind River. We have got partners like Keysight and Capgemini. So we've got a good ecosystem of technology partners. We have to get them to work together. And also in the future world where as I said earlier, we have to wake up to the fact that the world in which the whole pie is mine has gone

Ray Le Maistre, TelecomTV (20:51):
Right?

Andrea Dona, Vodafone (20:52):
Yeah. We have to work together to collaborate so that we create that pie and there's a big opportunity out there, but acknowledge that we will only get a part of that pie. But if that part of the pie is part of a big pie, then we're all winners. You can sit there wanting the whole pie and not get anything or work together to create that opportunity and have our fair share of that pie.

Ray Le Maistre, TelecomTV (21:19):
And scale brings a lot to everybody, doesn't it? Absolutely. And just one final thing, obviously we've been talking mostly here about cloud platforms and the mobile, the RAN network, but of course fiber plays an absolutely critical role not only in supporting the ram, but also as a service enabler itself. What does Vodafone, UK's Fiverr network asset look like and how are the partnerships you are developing around that working for you in terms of what you can deliver to customers?

Andrea Dona, Vodafone (21:54):
I wish, again, I had the capital to continue expanding on my current footprint. I do that, I do that to a good extent, but not as much as I would like. Therefore, had to be realistic and our strategy had to be a asset light strategy partnering with the likes of city fiber and VT open Beach. At the same time, I need to be very careful at my ongoing OPEX cost per every new circuit I order to service my network. It's additional opex. So I've got this constant balancing act to say if I've got the CapEx, I will invest the CapEx to introduce my own circuits. And this year has been a successful year. The year just completed, been a successful year in rolling out the highest number of fiber connections for my own purpose, for my own build and for my enterprise customers. If I had more money, I'd do more. Acknowledging that on the consumer side, I don't have the CapEx to meet the demand of consumers. So we've partnered very successfully with city fiber and Openreach and now we have the biggest fiber footprint in terms of FTTP fiber to the premise customers. And we can sell fiber to the consumer and we're the fastest growing HPV provider because of that. But I'm playing different games on the network side and on the enterprise. I'm also connecting my own file. I'd love to do more though if I had the money

Ray Le Maistre, TelecomTV (23:31):
Right.

Andrea Dona, Vodafone (23:32):
It's all about the money?

Ray Le Maistre, TelecomTV (23:34):
Hey, I'd buy some more coffee machines if I had the money as well. But that's another story. Andrea, great to catch up with you. Thanks very much.

Andrea Dona, Vodafone (23:41):
Thanks very much, Ray. Thank you.