O2 UK’s Q1 revenues are down 11 per cent from £1.58 billion last year to £1.41 billion this year thanks to the sliding pound. However, in comparable terms the company said it had actually experienced an increase of seven per cent.
The network added 141,753 net mobile customers in the quarter, bringing the network to a total mobile customer base of 20.41 million (excluding Tesco Mobile) at the end of March, representing a seven per cent year on year growth. The network attributed this to its Simplicity SIM-only tariffs, new business tariffs, broadband promotions as well as new contract and prepay mobile broadband tariffs.
O2 added 286,267 contract customers in Q1, an 18.4 per cent year on year rise. Contract customers made up 42.6 per cent of the total customer base at the end of March. The strong performance was due to large prepay migrations and a broader range of Simplicity tariffs, as well as an attraction towards high-end handsets such as the iPhone and BlackBerry.
Total ARPU showed a 3.6 per cent year on year decline to £21.71. The prepay base was also impacted by seasonal disconnections after Christmas. The network claimed it had the lowest churn recorded in the industry, with a year-on-year reduction of 0.2 percentage points in the quarter to reach 1.2 per cent.
O2’s home broadband service added 63,618 lines in Q1, giving it a total fixed broadband customer base of 404,484 lines.
Chairman and chief executive of Telefónica Europe Matthew Key said: “In the first quarter of 2009 Telefónica O2 UK continued to outperform in a slower market, achieving record levels of contract churn and obtaining market leading customer satisfaction indicators across all segments while delivering on ongoing efficiency programmes.
“During the quarter, we also announced a milestone pan-European network infrastructure sharing collaboration with Vodafone which will deliver cost efficiencies amounting to hundreds of millions of euros. We have now moved into the implementation phase of this wide-ranging programme.”