190,100 prepay users quit Virgin Mobile

Virgin Mobile's revenues have fallen in Q2 despite increasing its number of customers compared with the same period last year.

Virgin Mobile posted revenues of £143.9 million for Q2, a fall of £2.4 million compared to Q2 2007.

Virgin Mobile claimed 55,900 net contract additions in the quarter, up from 52,800 last year. It had 491,600 contract customers at the end of Q2, showing growth of 64 per cent in the last year.

The company suffered 190,100 prepay disconnections, almost double the number in the same period last year. It put the fall down to not "engaging heavily in the low price handset end of the prepay market" during a time of market turmoil.

ARPU was stable at £10.65 and operational cash flow was up slightly at £35.5 million in the quarter.

Virgin Media chief executive Neil Berkett said: "We have successfully undertaken actions to improve Mobile prepay performance including selective price increases, better focused customer retention activity and efforts to reduce customer acquisition costs."

Virgin Mobile has agreed new terms with its mobile network operator T-Mobile which will reduce the wholesale rates it pays for voice and data.

The MVNO is planning to launch a mobile broadband service in Q4 and claims it will be competitive as a result of the new agreement to give higher value to its customers.