Vodafone Group Plc (ADR) (NASDAQ:VOD) And Optus Plan Gradual Expansion To 5G

Vodafone Group Plc (ADR) (NASDAQ:VOD) and Optus are in the process of upgrading and expanding their networks with the target on 5G and the Internet of Things (IoT) support. It is expected that global rollout of 5G networks will come in 2020. Although Vodafone and Optus have their eyes on 5G, the companies plan to update their networks gradually in what sounds like a pull process rather than a push approach.

Vodafone Group Plc (ADR) (NASDAQ:VOD) and Optus are among the carriers around the world that are working to update their networks. Initially, the focus is on broadening network coverage and improving network quality to support the rapidly expanding smartphone connections.

The other reason for the widespread network upgrade is that carriers are positioning themselves for explosion of IoT connections. It is estimated that about 50 billion devices will be connected to the Internet by 2020, the same year that 5G rollout is expected to go global.

As part of their network upgrade plan, Vodafone and Optus intend to leverage spectrums to improve coverage in metropolitan areas and regional areas. The focus is on increasing network speeds, stability and availability.

VoLTE and VoWi-Fi support

Among other things, Vodafone Group Plc (ADR) (NASDAQ:VOD) is keen to roll out VoWi-Fi and VoLTE. Vodafone previously promised to roll out its VoLTE support before Christmas holiday. The management also said it was working for VoWi-Fi support for rollout next year.

Evolution to 5G

As much as 5G is the future according to Vodafone Group Plc (ADR) (NASDAQ:VOD) and Optus, the carriers are trying to be careful in their network evolution to 5G. According to Optus, many subscribers are still on 3G despite 4G having become widespread. As such, the best way the carriers have figured out to upgrade their networks is making the transition to 5G a gradual process. For example, instead of taking a push approach where they focus on devices, they want to take a pull approach whereby they focus on infrastructure build-out first.

Regulatory issues

However, in the network focused evolution, Vodafone Group Plc (ADR) (NASDAQ:VOD) and Optus expect to encounter multiple regulatory hurdles. The anticipated challenges range from spectrum availability and meeting strict standards.

Neha Gupta

Neha Gupta has been in the financial space for over six years now. Gupta earned her MBA degree from Symbiosis Centre of Distance Learning in 2009 and her passion for finance led her to pursue Chartered Financial Analyst (CFA) course. She has successfully completed Level II of her CFA. She is a veteran in article writing, which is depicted in her numerous pieces published on SeekingAlpha, Nextiphonenews, InsiderMonkey, MarketWatch, and Techinsider. Her crisp and eloquent writing finds its best place in Researchcows, where emphasis is given on developing rich content for various websites, products, business plans, trainings, and book writing.

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