Activities & results - Our Technology

‘Build for the Future’

Our third strategic pillar concerns the technology we offer. Internet and mobile telephony have become indispensable. People want to be able to stay in touch with family, friends or business contacts 24 hours a day, 7 days a week. To always have access to websites and apps, always be able to call an emergency number or transfer money online. Therefore, we have to make sure our network is reliable, fast and secure. For consumers ánd businesses. Enabling companies to develop innovative applications with our technology, now and in the future. Since technology develops at such speed, we rather say ‘Build for the Future’.

To be ready for the future, in 2014-2015 we invested for example in national 4G coverage, further rollout of 4G+, network upgrades, expansion and innovation, development of fixed and new products and services for our consumer and enterprise customers. At the same time we diminished our impact on the environment. All these items will remain important focus points in the coming years.

What is happening around us and how does this impact us?

High expectations about quality and network stability
People expect to be able to be online anytime, anyplace. Although the Netherlands has one of the best and the fastest mobile infrastructures of Europe, a 100% availability (anytime, anywhere) is unfeasible. Even with maximum investments this cannot be guaranteed. There are always external factors to take into account that are beyond our control, like weather conditions and the surrounding area (e.g. buildings).

Still, we need to manage our network properly, making it as reliable, stable and fast as possible. Not only our consumer and enterprise customers expect this from us, the Dutch government does as well. Telecom has become a vital infrastructure. A network that is not functioning as it should, impacts our economy and society in a major way. Just think about the emergency number 112, that needs to be contactable at all times. Also from border, rural or nature areas. As one of the largest providers in the Netherlands we have an important responsibility to guarantee continuity in (mobile) availability. At the same time, there are people in our society that worry about mobile phones, masts and any possible health effects. Vodafone is (an) active (partner) in studies and the search for solutions.

Trailblazer role in rolling out technological developments
After the auction of the frequency bandwidths that enable fast mobile internet, a technological race developed among the Dutch providers in 2013 to offer 4G as quickly as possible to as many people as possible. Vodafone being an A-brand, stakeholders expect a trailblazer role from us in the rollout and quality of 4G. This is why we invested in an accelerated rollout.

Fixed-mobile integration

The use of digital devices and services is still growing explosively and the market is moving towards a total integration of fixed and mobile. This requires that we keep expanding our network, keep investing in fixed internet and adapt our product and service portfolio accordingly.

Smart technology leads to energy savings
The ICT industry is responsible for 2.3% of the worldwide carbon footprint (source: GeSI, SMARTer 2030, 2015). The CO2 reduction potential of the ICT industry, however, is substantially bigger. Machine-to-Machine (M2M) technology increases efficiency of processes, resulting in energy savings in other industries. Besides saving energy in our own business operations, we strive to enable our customers to become more environmentally-friendly by using M2M technology.

Increasing scarcity of metals and e-waste
After much public debate concerning scarce metals originating from conflict areas and used in e.g. telephones, the European Parliament has adopted motions that stipulate companies have to explain the origin of the minerals they use. The new European directive ‘Waste Electrical and Electronic Equipment’ (WEEE) requires at least 70% to 85% of all discarded electrical and electronic equipment be collected in the year 2019. This legislation will impact our industry and our company.

>How do we involve our stakeholders?
>How do we determine the material issues?

How do we anticipate these developments?

To be and to remain ‘Build for the Future’ we focus on the following 4 key areas:

1. Our network
We want our customers to have access to mobile and fixed telephony and internet at all times, wherever they are. That is why we continuously work on making our network more robust, more reliable and faster. In this way we keep disruptions to a minimum and meet society’s demands, now and in the future. Our ‘Fast Forward’ programme is designed for network innovation to ensure we meet the needs of society now and in the future and to ensure a minimum number of failures.

2. Integration of IT systems
For the integration of approximately 25 IT systems, we are investing € 200 million. Vodafone’s service employees will in future be using one system. This will provide them with an unambiguous overview of everything that has ever been discussed with the customer. The new system will be the core of how we develop, sell, deliver, support and invoice our services.

3. New products and services
To anticipate a changing market and guarantee continuity, we are constantly developing new products and services for our consumer and enterprise customers.

4. Our impact on the environment
For the delivery of our products and services, we use electricity and materials. Our impact on the environment should, however, be as small as possible. ‘Build for the Future’ also means we need a sustainable vision and approach. That is why we focus on energy-efficiency and reuse or recycling of (network)materials and on ways to help our customers become more sustainable.

What is the progress on our goals?

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  1. The KPI has been changed. The previous year the KPI was to migrate all customers.
  2. This is a new KPI
  3. Energy efficiency is calculated by comparing the annual production of Vodafone against the total annual energy consumption. The production of Vodafone is expressed in the number of terabytes that is sent via the mobile network, the number of active mobile customers and the number of mobile phone masts.

What have we achieved in 2014-2015

Realised national 4G coverage
At the end of September 2014, we realised national 4G coverage, 6 months earlier than originally planned. With this achievement we met our KPI of >95% in 2014-2015.

As of 1 October 2014, we started expanding our 4G network with 4G+. At the moment 4G+ is available in 110 municipalities, among which Amsterdam, Rotterdam, Utrecht and The Hague. We now have the largest 4G+ footprint in the Netherlands. Customers experience superfast mobile internet and good connections at all times, even at busy locations.

Upgraded network
During the rollout of 4G we have also upgraded a total of 74% of our 3G sites, as a result of which our customers can use improved 3G data services. This means we overachieved on our target of 67% upgraded 3G locations.

In this network upgrade we replaced separate 2G and 3G equipment by 2G/3G/4G equipment (single RAN). In this way we use less equipment and save energy at the same time. This can result in a theoretical energy-efficiency of 20%.

Furthermore, in 2014 we introduced auto-aiming antennas, that become active of their own accord if capacity is needed. When there is no capacity demand, they are off. As a result, local coverage may be impacted. Energy-efficient measures should not lead to a diminished experience for our customers. We therefore closely monitor local network performance.
We are always looking for smart and invisible ways of installing antennas, for example in church towers or by painting them in the same colour as the wall against which they are mounted. In this way we ‘pollute’ the street scene as little as possible.

We have also started on building a network switch with a very high capacity – a so-called SuperSwitch – in Eindhoven. The new hub’s capacity is flexible and can in an emergency be taken over completely by switches in other locations. In this way we can diminish the impact of a large outage, like the one resulting from the major fire in the Rotterdam switch in 2012. The SuperSwitch meets the highest availability requirements that currently exist. The construction is part of the Fast Forward programme, in which Vodafone transforms its network from 12 smaller network switches to just three large, heavily secured network hubs that function as each other’s back-up.

Customers assess network quality for example by the amount of disruptions and the number of times a call is suddenly broken off. The latter is called the ‘dropped call rate’. We therefore invest in diminishing the number of network incidents and dropped calls.

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Expanded network
In order to improve our voice and data network, we expanded our 2G antenna fleet with almost 10% and our 3G antenna fleet with almost 5%. Overall we installed nearly 560 additional 2G and 3G antennas in the Netherlands, resulting primarily in improved voice coverage at many locations in border, rural and nature areas. In the border regions of Drenthe and Overijssel, we added 13 of the planned 89 antennas in 2014-2015. The remainder will follow in 2015-2016. We also carried out a pilot in the border areas of Limburg, where we optimised existing transmitter masts. The resulting improvements are significant. The number of successful calls on the 2G network rose with 8.5% and on the 3G network with 15%.

Innovated network
With our network innovation programme ‘Fast Forward’, we are making our network future-proof. As part of the programme, we installed 538 ‘small cells’ last year at busy locations like tram and bus stops. This resulted in enhanced capacity at these locations and improved mobile internet quality. Traffic over this network is for example safer than over Wi-Fi. Vodafone has the largest small cell footprint in the Netherlands and all of Europe. Furthermore, for all our customers we now provide 3G HD voice. This technology improves the quality of the call by suppressing e.g. background noise. For 229 corporate customers we improved indoor coverage at their office locations and other relevant buildings this year, using specific indoor coverage solutions. Read more about the safety of our network and our systems in the chapter about Governance.

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Invested in fixed network
Since 2011, Vodafone has already been offering TV, fixed internet and fixed telephony (Vodafone Thuis) via the optic fibre network of KPN. By also introducing TV services over the DSL network (Digital Subscriber Line) we have enabled national coverage of the entire service portfolio. To further improve our service provision, we have also invested in our own optic fibre network last year. By now 1 million households are connected to our (for the greater part) own network.

Optimised IT infrastructure
To further improve efficiency and quality of our service provision to customers, we have since 2011 been working on the integration and optimisation of our IT systems in the Unify programme. Just think of all the customer systems that support our service provision in our shops, online and by telephone. Merging 25 customer service systems into 1 is a complex operation during which all customers ‘move’ (migrate) to another system. This migration is a necessary step in improving the (self-)service possibilities for customers. They will receive a more transparent invoice and more functionalities in My Vodafone like managing multiple subscriptions in one account.

In 2014-2015 we have migrated the data of 2.3 million consumer and small business customers with a subscription to the new system. The migration of all our customers will be completed in the coming year.

More M2M solutions
Machine-to-Machine (M2M) communication connects machines or devices remotely. This enables data communication between systems or devices, offering opportunities for cost-saving, higher efficiency and new business models for companies. In 2014-2015 we have realised more M2M solutions. Our market share is now 54%. We highlight a few examples:

  • Enexis has equipped around 20,000 smart meters in 2014-2015 with M2M technology from Vodafone.
  • We started an insurance pilot in cooperation with Achmea. With permission of customers, Achmea uses M2M technology to monitor driving behaviour of these customers. It enables Achmea to calculate car insurance premiums better, fairer and on an individual level. A customer with good driving skills and less damage is rewarded by a lower premium.
  • There is also a partnership with ANWB. With ANWB Connected Car the car is connected to the internet through a dongle modem, sending data to the smartphone. The car owner receives information about the technical condition of his car, is always up-to-date as to his car’s location and receives feedback about his driving behaviour. This helps the car owner to drive safer and more energy-efficient, and save costs. It also enables the ANWB to quickly solve problems with cars or even prevent them.
  • Together with AntTail Vodafone has developed a new application for rheumatism medication. This application enables monitoring whether the rheumatism medication is stored at the right temperature. Monitoring also includes if and when the patient opens the package and takes his medication. Thanks to the application the quality of the treatment and therapy loyalty has improved immensely. Furthermore, medication returned unused and still of good quality, can be reused, saving millions of euros. Vodafone provides the wireless technology, infrastructure and expertise.
  • The Amsterdam-based bicycle manufacturer VANMOOF now manufactures a ‘connected’ bicycle with an integrated Machine-to-Machine SIM. In this way the bicycle is always connected to the Vodafone network all over the world, enabling owners to monitor the bike’s location in detail which renders stealing them something of the past.

Solutions for society

We also add value to society with other things besides our core service provision and organisational activities. Through our technology we stimulate innovations that fill a social need or form a solution for a social issue, leading to economic opportunities at the same time.

Mobiles for Good Challenge
Each year the Vodafone Foundation organises the Mobiles for Good Challenge. With this challenge we encourage the development of mobile applications with a social impact. The teams coming up with the best ideas are rewarded with a start-up capital of 30,000 euros to carry out their idea. Teams can also participate in the 4-months-long accelerator programme ‘Mobiles for Good Bootcamp’ during which we prepare the teams at high speed to bring their idea to the market. In 2014-2015 we had 6 winners. The team of Wind Tales was one of them, with an enchanting idea. Their smartphone game helps kids with pulmonary disease to do their exercises. Discovery Channel paid attention to the initiative with a short documentary. Another winning mobile application is the TraumaGamePlay. This game helps prevent victims developing a trauma after a serious incident. Read more about Mobiles for Good.

Start-up Bootcamp
Start-up Bootcamp is a worldwide network of partners, investors and mentors helping start-ups to scale up. Vodafone Netherlands is a 10% shareholder and accommodates the organisation and the start-ups on the 6th floor of the Vodafone office in Amsterdam. To scout start-ups, we organise events where start-ups can come and pitch their ideas. In 2015, we selected 11 start-ups out of more than 300 applicants for Start-up Bootcamp. The 11 chosen ones focus in various ways on making cities, houses and our living and working environment smarter. From sustainable and mobile energy to transportable houses, educational solutions and ‘the Internet of Things’. Read more about Start-up Bootcamp.

Vodafone Plaza
Many of our partners develop fantastic products based on our technology. To offer them a platform we started Vodafone Plaza in 2014, a web shop with innovative wireless products that can be connected to a smartphone. Like a WakaWaka charger and lamp, a smart camera and a VANMOOF bicycle with integrated GPS tracking system. This makes theft something of the past. Read more about Vodafone Plaza.

Expanded mobile payment service
This year we launched, together with International Card Services (ICS), the first mobile credit card of the Netherlands for contactless payments with a smartphone. The Visa World Card, issued by ICS, is available in the Vodafone Wallet, a virtual wallet in the form of an app. With this, customers can use their mobile phone for quick, easy and safe payments in shops and stations. Customers can also use the Vodafone Wallet to store all their discount cards and loyalty cards, enabling stores to scan them directly from the mobile phone’s display.

Environmental impact diminished and made transparent
In our environmental management programme ‘Planet Tomorrow’ we focus on energy-savings and collecting network equipment and mobile phones for recycling and reuse. This year we have also made our environmental impact transparent by quantifying the costs and benefits for society.

Improved energy-efficiency
In 2014-2015 we managed to get a better grip on our energy consumption. Now we have equipped 50% of our direct connections with smart meters. Our ambition is that by 2016, all of our direct connections have a smart meter. The smart meters are linked to an Energy Data Management Tool, which we use for data collection, monitoring, analysis and reporting whereby we are able to make focussed adjustments. We also use smart meters to measure the effect of energy-efficient measures. Like the power consumption of our 2G/3G network before and after the upgrade with newer and energy-efficient equipment. Furthermore, we have taken additional energy-saving measures in our already energy-efficient office locations. Our climate control system has been tuned, the lights are automatically switched off a few hours earlier and coffee machines now automatically switch on and off. Overall our energy-saving activities have resulted in an improved energy-efficiency (from 0.92% in 2013-2014 to 4.19% in 2014-2015). With this we met the KPI for this area.

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More recycling of network equipment
In 2014, we implemented the Vodafone e-waste policy. This No-Waste policy stipulates that all equipment and cabling of the network is registered and that our direct suppliers are required to reuse or recycle the materials. In 2014-2015, Vodafone recycled 75% of all network materials. We keep 14% in store in case we need the equipment again in future and 11% is reused.

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Stimulating the sustainable production and recycling of phones
Also in 2014-2015 Vodafone stimulated the recycling and reuse of phones through e.g. the Trade-in Deals. Furthermore, together with De Opkikker foundation we collected mobile handsets throughout the country. The proceeds go to De Opkikker foundation. All our actions together resulted in 100,204 phones collected in 2014-2015 ( compared to 88,497 in 2013-2014). Vodafone makes sure that collected phones are being reused or recycled.

The Vodafone Conflict Minerals Report 2014 describes how we ascertain the origin of conflict minerals in our products and try to reduce risks.

Stakeholder dialogue Circular Economy
In August 2014 we organised, together with VDBO, a multi-stakeholder dialogue about the circular economy and Vodafone’s role in this. During the dialogue the stakeholders were invited to present us with their views on propositions like the Trade-in deals, our product innovation and new business models. Besides 28 external stakeholders from the business community and the government, universities, consumer associations and NGOs, the dialogue was also attended by employees of our marketing department and the Director of the Consumer Business Unit. Our stakeholders were positive about our Trade-in deals. Less so about the NewPhoneEveryYear (NPEY) initiative. Part of the stakeholders struggled to recognize the circular element in this initiative. Stakeholders suggested we link our Eco score in a positive way to our Trade-in deals. This suggestion was followed (see the chapter ‘Our Customers’).

CO2  footprint diminished
In March 2015, we replaced 1 of the 8 diesel generators that we use to power antennas in remote areas, by a hydrogen generator. As a result we now emit approximately 30,000 kilos less CO2.

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* As of 1 April 2013, Vodafone uses wind energy produced in the Netherlands. That is why the CO2 emission from electricity consumption in scope 2 is considered zero as of 2013.

Support to the Knowledge Platform on Electromagnetic Fields and Health
We protect the health of our customers, employees and the public with regard to electromagnetic fields. Our measures are based on all the internationally available scientific information. We also actively cooperate in international and national scientific (independent) studies into possible effects of electromagnetic fields. For example the international COSMOS research in the Netherlands, carried out by the IRAS institute of the University of Utrecht (duration 30 years). We hope this study will give us insight into possible long-term effects of electromagnetic fields and into the best way for people to use their phone.

Furthermore, Vodafone and other providers are united in Monet. This body coordinates new locations for antennas with the authorities. Together with Monet we also enter into discussions with communities if an antenna location gives cause for commotion. Since 2002, we have an Antenna covenant agreed upon by the industry and the government. In this covenant the requirements have been laid down regarding the installation of license-free mobile communication antenna installations up to 5 meters in height.

Since 2015 we support the Knowledge platform EMV (Electromagnetic Fields and Health). This is an independent information centre where the RIVM (National Institute of Public Health and Environmental Protection), TNO (Netherlands Organization for Applied Scientific Research), KEMA (Testing, Research and Engineering Consultants to the Electric Power Industry), the GGDs (Regional/Municipal Health Services), the Radiocommunications Agency Netherlands and ZonMw (the Netherlands Organisation for Health Research and Development) have pooled their expertise regarding electromagnetic fields. The goal is to assess scientific information on the subject and make it available. More information about our worldwide policy and support to scientific research can be found on our website.

How did we realise our activities?

  • Investments in the network
  • Purchasing of green energy
  • Cooperation with stakeholders, like suppliers

How do we look back on our results?

Due to the fast rollout of 4G our customers benefit from a highly improved internet speed. We are convinced we deliver substantial added value to the way they stay in touch with the world. With the 4G+ coverage we realised in 2014-2015, Vodafone now has the largest 4G+ footprint in the Netherlands. We also have the largest smart cell footprint in Netherlands and the whole of Europe. At the same time we are still committed to upgrade and expand our 2G and 3G network.

We are also very satisfied with the fact that we realised national coverage with triple play.

Integrating our IT systems is a major operation. We tried to minimise any inconvenience this could cause our customers. Unfortunately, however, the migration of 2.3 million customers to the new IT systems did not go entirely flawlessly. We managed to resolve problems quickly though, keeping the inconvenience to a minimum and short-lived.

Due to the fast rollout of 4G our customers benefit from a highly improved internet speed.

When it comes to the environment, Vodafone Netherlands performs well. Within the Vodafone Group, Vodafone Netherlands has the smallest C02 footprint, relatively speaking. In 2014-2015, we further improved our energy-efficiency.

Dilemma
Speaking of energy-savings, each decision can be a potential dilemma. Measures aimed at saving energy can influence the way customers experience our products and services. This was for example the case with the auto-aiming antennas. We did decide to deploy the auto-aiming antennas, but we monitor network performance closely to be able to intervene when necessary.

What is the impact on our environment?

Our activities have a number of effects:

  • By investing in the development of employees, we increase the intellectual capita in the Netherlands, also in the field of network technology.
  • Due to our high-quality, stable and secure infrastructure, we enable our customers to stay in touch wherever they are and whenever they want, call the emergency services and access information and entertainment anyplace, anytime. This offers them convenience, freedom and knowledge, saves time and contributes to health and safety in our country.
  • Our high-quality telecom infrastructure makes the Netherlands an attractive place for start-ups that generate innovation and employment.
  • For our business customers, a high-quality, stable and secure infrastructure leads to efficiency in capacity, costs, mobility and CO2 emission and to increased productivity and safety. Based on our infrastructure, companies can also develop new applications resulting in even more efficiency and sustainability. For example integrated communication flows or ‘smart’ power meters. This leads to more prosperity at lower costs and less pollution. See also the report ‘Netherlands ICT’.
  • We diminished the CO2 emission of our own production process and that of others using our technology, and we produce less waste by recycling and reuse. Also see the next paragraph on Costs and benefits for society of our environmental impact.
  • Regional roaming is designed to protect our society better against the impact of a major network outage. Through an alliance with other providers and the government we have agreed to partly take over each other’s service provision if one of the networks breaks down.

A high-quality, stable and secure infrastructure leads to efficiency in capacity, costs, mobility and CO2 emission and to increased productivity and safety.

Costs and benefits for society of our environmental impact
We believe that the products we offer have a positive impact on society, the environment and the economy. We try to make that positive impact as substantial as possible in all three areas while simultaneously reducing our negative environmental impact. To gain an understanding of which approach works best for Vodafone, we started this year with a calculation of our environmental impact through an Environmental Profit & Loss account (E P&L). We value transparency. That is why we publish the entire process of how we arrived at this profit & loss account online.

“Preparing a profit & loss account for the environment insofar as it is impacted by Vodafone’s business, is a great initiative. It will help us understand the interrelated environmental interests of the company and society and it will enable the company to properly balance the costs and benefits for society. Future business processes and investments can be guided towards creating real shared value, for Vodafone as well as society in general.” Karel Zeldenrust, Directorate for Sustainability, Ministry of Infrastructure and the Environment.

The scope of our environmental profit & loss account was determined together with our stakeholders. The analysis comprises the following environmental themes:

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With regard to our network as well as all our products, we look at the entire value chain, including transport, for our impact analysis. As to offices rented by Vodafone, we opted to take only usage into consideration.

The result
The result can be split into three different elements:
1. The negative impact of our own operations (employees, operating the network, and the use of offices and shops): ≈1.9 million euro.
2. The negative impact of the value chain of the network and the products, excluding our own operations: ≈19.7 million euro.
3. The positive impact of Vodafone products on other companies, enabling them to emit less CO2: ≈37.3 million euro.

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The detailed results and method, also describing the uncertainties we have acknowledged and assumptions we have made, can be found here.

These results indicate that Vodafone has in fact a very limited negative impact on the environment. Only 9% of the environmental impact is caused by direct Vodafone activities. So, with the Vodafone operation being relatively ‘green’, the manufacturing of mobile phones on the other hand accounts for a rather large negative impact.

Other companies can achieve a relatively large environmental profit by using Vodafone products, subsequently avoiding CO2 emission. The big CO2 savings can be achieved by The New Way of Working. For instance, by working from home, less travelling is required. This saves so much CO2, outweighing by far the extra CO2 that is emitted by home heating systems which are less efficient than in the office. Also ‘track and trace’ solutions for especially commercial vehicles can result in CO2 reduction by our customers. Our M2M services play a crucial role in this.

For the negative as well as the positive environmental impact, CO2 emission is by far the key contributing factor.

With a view to the environment, our products and services are primarily our greatest assets for our customers. As discussed in the stakeholder dialogue, we will be focusing especially on supporting our customers reducing their CO2 emission with the help of our products and services.

What do we want to achieve in the coming years?

Also in the years to come we will work on a future-proof network. We want to further expand our 4G and 4G+ network to create even denser coverage. This will also result in better coverage in border, rural and nature areas. Furthermore, we want to enhance our small cell footprint in the Netherlands. The ongoing rollout of 4G will increase our energy consumption. By replacing old equipment by 2/3/4G equipment (single RAN), we will save as much energy as possible, thus minimising our impact on the environment.

Another focus point to remain ‘Build for the Future’ is the ongoing reduction in the number of data centres. This is more efficient, safer and energy-efficient and reduces the risk of failures with the resultant impact. However, the environmental benefit we can offer our business customers with our technology is far greater than our own environmental footprint. For this reason we will adjust our KPI for our CO2 emission. In 2015-2016, the CO2 reduction by our customers through our products and services should be 25 times the amount of the CO2 emission from our own operations.

Realising our new IT infrastructure will also remain a major point of attention. We want to integrate all customer segments and all channels (shops, telesales, indirect dealers, online shop) into our new Unify platform.

This article is composed by Carla Massini, Eelco Ploum, Martin de Jong and Zhanghua Luo
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