Vodafone pressure sets Verizon backpedalling

A rift has surfaced between Vodafone and Verizon following a statement from the latter last week that it intends to implement 3G technology in the US that is incompatible with that of Europe.

Verizon Wireless, a joint venture between the two companies, announced plans to build its 3G network in the US using CDMA2000 rather than UMTS. Vodafone, which has a 45 per cent stake in Verizon Wireless, wishes to use a different version of CDMA (code division multiple access) called UMTS (universal mobile telephone system), enabling its phone owners to use the same mobile device on both sides of the Atlantic. Vodafone has convinced its US partner to delay its decision but there is speculation that Vodafone intends to try to take total control of Verizon's wireless unit. One possibility being offered up is that the announcement from Verizon was a defensive move to reduce its appeal to Vodafone. However, Verizon has retracted last week's announcement that it would go ahead with CDMA2000 and has now stated a final decision is unlikely for two or three years. Yesterday, Verizon's shares fell $2.92, or 5.83 per cent, to $47.19, while Vodafone shares fell nine pence, or 4.2 per cent, to £2.04.