Karen Egan, head of mobile at Enders Analysis, said the results were “strong on a headline level” but warned the figures were skewed by “erratic” growth in markets such as Italy and Egypt.

“These companies are still investing large amounts but capital deployed is going into technology like AI that is designed to reduce headcount intensity in the long run,” said Jamie MacEwan, Enders. “The next big bet is that they can do more with less.”

“She’s all signed up to the strategy,” says Karen Egan, head of mobile at Enders Analysis. “Nonetheless, you will expect her to want to make her own mark somewhat, and I suppose there’s probably a bit of nervousness about what that might look like.”

“I’m not a huge fan of all this tinkering and restructuring in telecoms companies, just to make your mark as a new chief executive,” says Egan. “BT is not a place for revolutions.”

On valuation grounds the proposed transaction favoured Iliad. The JV, with an enterprise value of €14.9bn, would have raised €7bn in new debt to pay €6.6bn to Vodafone and €0.4bn to Iliad. That would have left Vodafone with cash and securities worth €10.5bn, or eight times its Italian unit’s forecast ebitda after lease payments. Iliad, admittedly faster growing but as yet barely profitable, would have been valued at 17 times ebitda, estimates Karen Egan at Enders Analysis. 

“Culturally, Vodafone is closer to Swisscom than to Iliad, whose methods of forcing the agenda, for example anticipating the publication of a press release on its own offer, may have irritated management,” notes Karen Egan , the telecoms analyst for the London firm Enders.

Karen Egan, an analyst at Enders Analysis, also sees a bigger benefit: “Unlike most industry consolidation, a merger in the mobile sector does not imply taking capacity out of the market – in fact the reverse”. So, there’d be the same amount of spectrum but more competition to fill it, potentially leading to better deals from “mobile virtual network operators”, such as Tesco, Asda and Sky that offer services via the four networks.

But some of these smaller debt-laden companies are now being squeezed by rising interest rates and disappointing uptake, resulting in slowdowns of their rollouts and more than 1,250 job cuts across the industry in 2023, according to data compiled by Enders Analysis.

James Barford, head of telecoms at the research firm, estimated total capital expenditure by altnets of between £8bn to £9bn so far. But many altnets are now “struggling due to tougher financial conditions” and deployments have been paused as “investors demand better performance on existing footprints”, Barford said.

He added consolidation was “sorely needed” but that negotiations will be challenging because some altnets will not be worth the amount invested in them. Potential acquirers will also be debating whether it is more cost effective to build or buy areas that do not overlap with their own full-fibre footprints.