8/9/2007 1:08:00 PM
T-Mobile adds just 51,000 customers in Q2
T-Mobile added just 51,000 net customers in the second quarter of 2007, down 86% from the 369,000 net additions in the same quarter of 2006.
But its net additions figure was still higher than O2's 34,000 net new customers in the second quarter.
The operator's contract additions of 72,000 subscribers were significantly down from the 363,000 new contract customers in Q2 of 2006. T-Mobile lost 22,000 prepay net adds.
In the quarter, T-Mobile had 16.8 million subscribers, of which 3.9 million are contract customers, up 8% on the same quarter of 2006. Prepay subscriber numbers, including Virgin Mobile, fell 2% over the year to 12.9 million.
T-Mobile launched 'Top Up Friday' last month, in which customers who top up on a Friday get unlimited free texts all day Saturday and Sunday.
Virgin's prepay declines of 99,300 customers, which meant Virgin's overall net additions slumped by 46,500, hit T-Mobile's numbers in the second quarter.
Of its total contract customers, over 1.9 million – some 49% – are now on Flext. The operator said the 'substantial change in the mix of our customer base' has driven increased blended ARPU up 11% in Q2 to a monthly average of £21 per customer. Churn fell by 0.1%.
T-Mobile is concentrating on generating revenue since driving new customers on to contracts at the beginning of the year. The operator added 106,000 net new contract customers in the first quarter of 2007, but the start to the year was far less aggressive than in the first quarter of 2006, which saw it net 266,000 new contract customers.
T-Mobile has this week slashed the inclusive value of its 12-month Flext tariffs for new customers, dropping the combined value of texts and minutes offered by as much as £45. On the Flext £25 12-month tariff, the £40 of inclusive value offered in July has been dropped to £30. On Flext's £35 contract, inclusive value has fallen from £120 to £90. Flext's £50 contract now includes £125 worth of value, down from £170.
The network has also stopped including voicemail in its Flext value package and has introduced a minimum call charge of one minute for all Flext tariffs. T-Mobile said the move was 'part of a price review', but that the 'tariffs were still good value'.
T-Mobile's net revenues rose 4% over the year to £799m in Q2. ARPU revenues grew by 8% to £728m year on year.
The operator said: 'This, together with our continued focus on our cost base, has lead to improvements in EBITDA to £338m in the first half of the year.'
Jim Hyde, chief executive and MD of T- Mobile UK, said: 'These results show the continuing success of T-Mobile's focus on contract customers and our continuing reluctance to take on low-end, high-churn prepay customers. As a result, the contract customers now represent 23% of our total base, up from 20% at the beginning of last year and our ARPU revenues continue to grow at a market-leading pace up 12% year on year, driving continued profitability with EBITDA margin up 5.7 percentage points.'