Vodafone Malta CEO Sonia Hernandez speaks to Anthony Manduca about the company’s plans for the future and the challenges of a small market.

Vodafone will be investing €150 million over the next few years aimed at creating “the most engaging digital customer experience” by adopting new ways of working, embracing new technologies and simplifying business models, Sonia Hernandez tells The Sunday Times of Malta.

“This investment includes continued development in Vodafone’s network to ensure it remains top of the class and future-proof ready and, additionally, we’ll be also increasing big time our investment in IT to drive the transformation of digitising our services and innovation to help Malta move faster towards a digital society. We are also investing in developing a highly skilled workforce, and recruiting a further 40 people for various roles across the business.

 “The world around is becoming increasingly more and more connected and we believe we have a role to play in helping our customers realise the opportunities this brings and help them make the most of it,” she says in her first interview since taking over as Vodafone Malta CEO.

One of the enablers in this, she points out, is the Internet of Things (IoT). “Around the world, industries are being transformed and on a global level, Vodafone has been rated by analysts as a leader in IoT. Vodafone has helped organisations from all industries – from healthcare to manufacturing, automotive to the public sector – along their IoT journeys. The potential benefits of IoT are immense and we’ll be leveraging our global expertise and experience to transform Malta’s businesses through IoT.”

She says Malta is an “incredibly exciting” place to be in at the moment. The country, she points out, is evolving at a rapid pace and punches above its weight when it comes to its spread of expertise and to introducing the latest and most cutting-edge technologies.

 “My view is that Vodafone has an important role to play in bringing value to Malta and in helping transform people’s lives for the better. And I mean this not only in the sense of bringing the Maltese the newest technologies first, coupled with the best quality of service, but also by going well and truly above and beyond this. Here at Vodafone, we call this ‘Connecting for Good’. Let me give you just three examples:

“We want to empower young Maltese women and address the persistently wide gender gap in STEM (Science, Technology, Engineering and Maths) careers. Our Code Like a Girl initiative was born out of this. We offered girls aged between 14 and 18 free training sessions on coding in a bid to give them a taster of the fun and opportunities which come from studying and pursuing a career in technology. We were overwhelmed by the feedback we received and the thirst for such initiatives, and heartened by the girls’ sheer enthusiasm and boundless energy.

“We want to use our technology to provide an alternative to drugs in order to relieve the pain which children suffering from various illnesses such as cancer go through. This led to the Vodafone Malta Foundation’s collaboration with the University’s Department of Artificial Intelligence, which will result in cutting-edge technology combining virtual reality with ‘affective gaming’, meaning that the specially designed game will be intelligent enough to also determine the child’s emotional and physical state and adjust the game accordingly in real time to distract the child from feeling pain.

The potential benefits of the Internet of Things are immense and we’ll be leveraging our global expertise and experience to transform Malta’s businesses through IoT

“We want to provide the best blend of personal and digital services. We are investing heavily in this to truly transform our business to be ready for all future needs of our customers as well.”

To achieve all this, Vodafone Malta wants to be the best digital workplace, having implemented flexible working as well as mobile working across its workforce, therefore supporting employees to cope with their personal and family responsibilities and strike a healthy work-life balance.

“My vision is ultimately that of transforming the company into Digital Vodafone in order to connect Malta for a better future – an ambitious purpose, I know, but one which I believe we are uniquely positioned to deliver on,” she insists.

What are the main challenges facing the telecoms industry?

“In Malta, particularly, operators are restricted by their scale. Technology is moving at an ever faster rate. Keeping up with the latest trends and providing the newest technologies to the market can be very costly. Having said that, the sector as a whole has performed very well to date and I believe the MCA surveys show that customers in Malta are happy with the services they are getting.”

Regarding the proposed merger with Melita which collapsed last December she insists that this fell through because the two companies were unable to provide sufficient commitments that would have allayed the concerns of the Competition Authority, rather than Vodafone objecting to the requests by the authorities.

She says that the company always has alternative strategies and is very confident that Vodafone will remain a leading operator delivering the best value for its customers in Malta.

The fact, she stresses, that GO had objected so vigorously to the proposed transaction leads one to believe that they were “apprehensive” of what a combined Vodafone and Melita could deliver since GO would have had a fully converged competitor with a strong international background.

How worried is she about the encroachment of OTT (Over The Top) competitors such as Facebook and WhatsApp?

“There is no question that OTT competitors are part of the competitive landscape. These services require good quality connectivity to reach customers and, in this respect, I think that we can view OTT players as complementary to what we do as our services are going to be needed more than ever.

“Of course, we can’t help noting that the playing field is not always level as the network operators have to contend with a lot of regulation which the OTT players seem to slip through.

“In Malta particularly, our services carry a four per cent excise tax which certainly does not help the situation. While fully appreciating the challenges governments face to balance their budgets, I really believe that this issue should be looked at again.”

Vodafone Malta’s market share of mobile telephony at the moment is 43 per cent in terms of SIM cards used by customers, and asked how she would like to see this figure expand she replies:  “Regarding future developments, quite honestly, we don’t really believe in chasing numbers just for the sake of it. We much prefer to focus on value.”

She adds that it may very well be that the market in Malta will contract in terms of numbers. Following the roaming regulations, she explains, many EU citizens that previously came to Malta and bought a local SIM card are now opting to use their home country SIM card.

Vodafone Malta’s market share of mobile telephony at the moment is 43 per cent

Regarding Vodafone’s market share of the internet sector in Malta, Ms Hernandez says the company has four per cent of what is termed as the ‘broadband market’. This refers to fixed internet connections in the homes or businesses and does not include people who use internet over their mobile phone.

For consumers and small offices, Vodafone launched a home internet product “which was received very well but we don’t want to oversell it”.

She adds: “Our current home internet product is based on mobile technology and we want to make sure that we do not impact the experience of mobile users by having too many home internet users with this technology on our network.

“Therefore, we are selective and offer this product in areas where we have ample capacity and also offer a unique try and buy opportunity: if the customer is not satisfied for any reason they can bring back the product within the first 14 days without any penalties being charged for cancelling the contract.

“Since the broadband market is growing, it provides good opportunities for all operators to expand at the same time, and we’re looking into other technologies to expand our services in this space further.”

Ms Hernandez says that compared to other markets the main challenge in Malta is scale. “Technology investments are costlier here when taking into consideration the size of the market. Also, for example, the obligations of the recent GDPR legislation are the same for a small company like ours as they are for larger operations in Europe. However, the cost of implementation these obligations is much larger for us as a percentage of our revenues.

“Having said all this, I am not at all discouraged by our size. We have an excellent team with unique skills in Malta. There is something special about being part of Vodafone; we have a very positive, unique culture and the ambition and entrepreneurial spirit to punch above our weight, and that’s what I intend to do.”

She concludes: “I love Malta and I aim to transform Vodafone towards ‘Digital Vodafone’ as the vehicle to deliver our purpose of ‘connecting Malta for a better future’”.