Vodafone New Zealand, a subsidiary of Vodafone Group Plc (VOD - Analyst Report), has announced its plans to conduct a trial on 4G small cells that would cater to the enterprise market.
The new trial, scheduled for July, comes close on the heels of the company’s test of 3G small cells using DC-HSPA (dual-carrier high-speed packet access) small cells technology with download speed of 42 Mbps and equipment supplied by Nokia Corporation (NOK - Analyst Report).
We believe this new development in terms of network technology will drive growth for Vodafone, strengthening its foothold in the global wireless business as well as capturing new and emerging business areas such as the enterprise market.
Further, we believe the re-structuring of the enterprise business into one unit – Vodafone Group Enterprise and the integration of Cable & Wireless Worldwide enhanced the company’s product portfolio and propelled opportunities in large and medium-sized businesses.
In line with the company’s plan to expand its Enterprise segment, in Feb 2013, Vodafone inked a multi-year contract with BAE Systems plc, which deals in defense, aerospace and security business to supply mobile communication worldwide. The agreement remains accretive to the company’s global enterprise customers while promoting its security products and services.
Other steps taken by Vodafone to enhance the Enterprise business include the company's 15-year deal worth $61.5 million with state power transmission company – Teias – for providing fiber network. Per the deal, Vodafone will expand its fiber network by two-and-half times to 16,000 kilometers (9,941 miles) by adding lines from Teias. We believe such growth plans in emerging regions like Turkey will enable the company to foster its business in the European continent. The company expects the deal to remain accretive to its infrastructural development including expansion of the fiber lines of Vodafone’s global network to 1 million kilometers.
Further, Vodafone Group expects to continue with its fiber expansion in other countries like Iran, Syria, Georgia, Iraq and India, accelerating growth in its Enterprise market share.
Vodafone currently has a Zacks Rank #3 (Hold).
Better-ranked stocks worth considering in this sector are KT Corp. (KT - Snapshot Report) and Level 3 Communications, Inc. (LVLT - Analyst Report). While KT Corp. sports a Zacks Rank #1 (Strong Buy), Level 3 Communications holds a Zacks Rank #2 (Buy).