Vodafone Group launched discount brand Bit into the Spanish market and cut prices at its low-cost operation in Italy, as the operator stepped-up efforts to address stiff price competition in the two markets.

In its latest financial update, covering the three months to end-June, the operator pointed to increased competition in Spain and Italy as factors impacting its European service revenue.

After launching a number of deals under its main brand in Spain to help reverse declines, the group has now turned to discount brand Vodafone Bit to steady the ship. The sub-brand will charge €25 per month for unlimited calls and 25GB of data, or €50 for the same offer plus fibre. Vodafone’s standard 25GB SIM-only deal in the country costs €41.

Bit is being marketed as Vodafone’s “first 100 per cent digital brand in the market” and is only available online. Customer care for the operation will also only be available through its app or website.

By contrast, the same mobile allocation and faster fibre speeds with MasMovil brand Yoigo costs €59, while the operator’s SIM-only tariff is currently on promotion for the same price as Vodafone Bit. Telefonica’s Movistar brand charges €50 a month for 25GB SIM-only, with its fibre inclusive deals also covering TV services, making them incomparable.

Orange Spain’s SIM-only rates are €47.95 for the same allocation as Vodafone Bit, with no equivalent fibre-inclusive tariff available.

The launch of a low cost brand in Spain follows Vodafone’s strategy in Italy where, in response to the aggressive entry of Iliad, Vodafone developed discount brand Ho.

After initially charging €9.99 per month for unlimited minutes, texts and 50GB on Ho, it has since slashed the price of the tariff for existing Iliad or MVNO customers to €4.99 a month, undercutting Iliad by €1.