Vodafone sets a fast pace

For throwing down the gauntlet to BT on ultrafast broadband, Vodafone deserves high praise. Britain’s mobile pioneer is challenging BT on turf it dominates in the same way BT parked its tanks on Vodafone’s lawn when it was allowed to buy mobile operator EE.

The winners from Vodafone UK’s initiative will be consumers who may gain real choice, other telecoms providers, who will have an alternative to BT’s clunky openreach, and Britain, which needs ultrafast broadband urgently to bolster productivity.

Vodafone has formed a partnership with AIM-quoted CityFibre (shares up 40pc) to roll out ultrafast to 5m homes, mainly secondary cities by 2025. The only pity is it can’t be quicker.

Vodafone’s decision to pile in is a fitting response to BT’s lacklustre response to the fibre challenge. BT has been prepared to splash out billions of pounds on Premier, Champions and Europa league football rights but has brought out the begging bowl for ultrafast broadband.

This partly reflects an inherent conflict in what BT is doing. The slower openreach is in delivering ultrafast to the public the less likely users might be to opt for streaming services for their sports and entertainment coverage. The importance of the competi- tion being offered by Vodafone was immediately recognised by regulator ofcom as well as consumer groups.

BT has managed to preserve its domination of landline telecoms and broadband because it controls the exchanges, old copper wires, tunnels and ducts through openreach. It is only under pressure from ofcom, and rivals TalkTalk and Sky, that BT ceded control of openreach to an independent board and management. But competitors feel it has not gone far enough.

Among the UK’s great competitive advantages in a post-Brexit world will be hightech, artificial intelligence, financial technology and the content provided by the creative sector. All of that is put at risk unless the UK has the same kind of trans- mission speeds as global competitors Japan and South Korea.

If BT’s new chairman Jan du Plessis wants to leave a legacy, then he should meet the Vodafone initiative by switching more resources to ultrafast fibre rather than bleating about cost.

National interest demands it.

Argos ambition

IN contrast to M&S, grocer Sainsbury’s has not had to wait for a new chairman to speed up change. It has pushed ahead with the integration of Home retail Group, delivered 112 Argos stores in Sainsbury’s branches and is racing to advance further in the run-up to Christmas.

Any concerns that it might have bought a pig in a poke with the Argos platform and logistics look so far to have been proved unfounded, and chief executive Mike Coupe is pledging that you will able to buy that forgotten present by noon on Christmas Eve and have it under the tree.

Argos also sensibly looks to have an eye on Sainsbury’s middle-class clientele and is adding aspirational brands including Neff built-in kitchen appliances, Bodum accessories and branded timepieces from DKNY and Boss.

And if you are into supermarket shopping for men’s style you can now buy a British made Tu formal three-piece suit at the larger stores.

Achieving Argos synergies continues to mess with bottom-line profits, with the balance sheet having to absorb £130m of exceptional integration costs and £140m of capital expenditure.

But, as already indicated, Sainsbury’s plans to deliver an extra £160m of underlying profit by the first half of 2019-20.

All of this is made possible by the restoration of overall same-store sales, up 1.6pc, with convenience and online pushing ahead in high single digits.

It might not be a credible competitor to Amazon in the UK just yet.

But its established place in grocery is something that Whole Foods can only dream of.

Float kowtow

THE idea of the UK Treasury writing a bank cheque for a £1.5bn loan to £1.6trillion Saudi oil giant Aramco beggars imagination.

This, at a moment when riyadh is in lockdown following hotel arrests of a bunch of princes including the acquisitive Al-Waleed bin Talal, and on the day that the UN warns that Yemen faces a humanitarian crisis because of a Saudi blockade.

Still, if the City wants the Aramco float, appeasement has to be order of the day.