Network sharing agreement with Everything Everywhere contributes strongly to £173 million EBIT profit
Three has announced its first profit which has been attributed, in part to its network sharing agreement with Everything Everywhere
The network sharing agreement, in which Three gained the right to use 3,000 cell sites – free of operating costs from Everything Everywhere created a “one-time substantial” benefit of £500 million according to the operator.
The profit which was released as part of Three’s parent company – Hutchison Wampoah’s 2010 results saw the company post EBIT earnings of £173 million.
2010 also saw Three start selling Apple’s iPhone – the last of the UK operators to do so – in June which produced a customer increase.
The launch of Three’s ‘The One Plan’ has also drawn in a lot of contract custom, according to the company.
The results are further good news for operator which welcomed Ofcom’s announcement, earlier this month that Mobile Termination Rates (MTRs) would be cut at the start of April.
Three has been hit hard by the steep rates of MTRs in the past due to its size in the UK market, but the reduction is set to place Three in a good position moving forward.
It has also launched an increased drive to attract prepay subscribers through a new version of its “The One Plan’ deal which has been tailored for this market.
This drive at the prepay market, along with the MTR reduction and the strong demand for smartphones in the UK could well see Three’s profits increase further as time moves on.
Three chief executive Kevin Russell (pictured) said: “We will continue to operate with a profit as we grow the business.”
Meanwhile Hutchison Whampoa posted a 47 per cent increase in net profit for 2010, drive by a new found invigoration from its third generation mobile operators around the world that had negatively reduced its earnings for a number of years.