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Vodafone Group Plc (VOD - Analyst Report) has reportedly won 4G spectrum auction in the U.K. The company will now have to pay 790.8 million pounds to British regulator Ofcom in leiu of spectrum ranging in the bands of 800MHz to 2.6GHz. The new spectrum win is expected to boost the company’s LTE expansion resulting in incremental revenues.

Vodafone is way ahead of its competitors in upgrading 3G and HSPA+ networks. Further, the company is accelerating its 4G expansion and is focusing on South Africa and European expansion with coverage in Germany, Rome and Milan and Italy. Vodafone expects to roll out LTE in Australia in 2013. Ongoing efforts to upgrade the existing network infrastructure should result in higher network efficiency and increased mobile data capacity. The company is also working on spectrum acquisitions and recently secured spectrum licensing in the Netherlands, Ireland and India.

Vodafone is continuously gaining share in the majority of its markets due to the strong adoption of data services and migration to smartphones. Vodafone’s future growth hinges on key drivers. These include increasing mobile data services, enlarging growth in enterprise markets by implementing converged fixed and mobile services (Vodafone One Net), new pricing plan such as Vodafone Red, expanding growth in emerging markets including Eastern Europe, India and Africa, growing in new areas including machine-to-machine, near-field communications and mobile financial services, as well as maintaining liquid investment in quality networks

Further, we believe the re-structuring of enterprise business into one unit, Vodafone Group Enterprise and integration of Cable & Wireless Worldwide will enable the company to enhance its product portfolio and tap opportunities in large and medium-sized businesses.

Vodafone remains focused on increasing its smartphone penetration, which represents nearly 80% of all sales, and comprises over 50% of the customer base. The company also gained from its new prcing plan, Vodafone Red, which incorporates unlimited voice and SMS, increased roaming services, shared plans, early upgrades, cloud and other value added services. By introducing such plans, the company expects to mitigate competitive threats from big players that are winning over data services. The company launched Vodafone Red in five markets with 2.2 million contract customers across Europe. In the coming months, Vodafone targets to launch such plan in other European countries like Preparing for UK, Netherlands, Australia, New Zealand and Ireland alongside emerging markets

Based in Newbury, United Kingdom, Vodafone Group is the world’s largest revenue generating wireless communications operator and the second largest carrier after China Mobile Limited (CHL - Snapshot Report) based on subscription.

Vodafone has Zacks Rank #3 (Hold)

Other Stocks

Mobile Telesystems OJSC (MBT - Snapshot Report) and France Telecom , both having Zacks Rank #2 (Buy) are two stock we believe worth considering in this sector.

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