Vodafone’s (LON:VOD) Australian unit has scrapped its lock-in contracts in an overhaul of its post-paid plans. The move comes as the blue-chip telco looks to get an edge over rivals Down Under.
At home, Vodafone’s share price has inched marginally higher today, having added 0.10 percent to 222.00p as of 14:33 BST, slightly underperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.78 percent higher at 7,441.29 points. The group’s shares have lost more than six percent of their value over the past year, but are up by some 11 percent in the year-to-date.
The Australian reported today that Vodafone had moved to eliminate its lock-in contracts, as the market gets ready for the release of the Samsung Galaxy Note 8 and the next iPhone later this year. Under the overhaul, the telco’s customers can sign up to a SIM-only plan, and can either buy the smartphones outright or spread out the cost over 12, 24 and 36-month instalments, without early payment penalties.
While traditional post-paid plans include the device payments into the monthly fee, Vodafone looks to separate mobile services and phone repayments.
“This gives people the power to create a payment structure that suits them. It also helps them easily see what they’re paying for each month, without locking them in for long periods of time,” Vodafone’s consumer business unit director Ben McIntosh told the newspaper, adding that that the new approach was in sharp contrast to the current leasing options available in the market.
In analyst news, Barclays reiterated its ‘equal weight’ rating on Vodafone yesterday, valuing the shares at 225p. According to MarketBeat, the FTSE 100 telco currently has a consensus ‘hold’ rating and an average price target of 243.55p.