Verizon Business came into existence in January, three weeks after the US RBOC completed the acquisition of long-distance and international network operator MCI Inc. It is focused on a customer base on the eastern seaboard of the US, with MCI’s entirely business-focused activities, underscored by its core asset, a global MPLS network.
Among the products the acquisition brought Verizon was Enterprise Mobility, a global connectivity offering from MCI enabling corporate customers via a software client on their laptop to connect back to their enterprise networks via WiFi hotspots around the world, without needing to pay for the access on the spot because usage is added to their monthly bill.
To that service Verizon Business added cellular access in January, leveraging the RBOC’s 55% stake in Verizon Wireless to bring EV-DO connectivity, which can be added to the same data card. That is only a first phase, however, as EV-DO is a 3.5G technology in the CDMA line of development, but CDMA is absent altogether from Europe, where the central authorities mandated the GSM line of development back in the early nineties.
Since cellular connectivity is delivered via a data card, adding access for the GSM world (ideally the 3.5G flavor called HSDPA) would be a relatively simple matter on a technical level. The challenge would rather be a commercial one, and Verizon would need to negotiate roaming agreements with HSDPA network operators, as well as geographical, in that it would need deals to cover at least the main countries to which US business travelers travel.
For both these reasons, the carrier’s 45% partner in Verizon Wireless, UK-based Vodafone Group Plc, would seem an ideal choice. Not only does Vodafone have properties (mobile networks) in about 28 countries, particularly in western Europe, but also it is actively upgrading them to HSDPA in the most demanding markets. In at least one case, Vodafone Italy, Verizon is even a minority shareholder.
Furthermore, there is clearly a need for Basking Ridge, New Jersey-based Verizon to add GSM connectivity to Enterprise Mobility sooner rather than later if it is to compete for business from corporations with large European operations. A case in point is ABN Amro, the Dutch bank that was already an MCI global customer before the acquisition.
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