2/13/2008 11:15:00 AM
PS3 and tariffs buoy Orange
Orange posted a major surge in contract customers in its financial results last week, fuelled by cheap tariffs, free games consoles and rich commissions.
The operator’s annual results for 2007 show that 640,000 new contract customers signed with Orange in 2007.
Although the payback from these new customers won’t be seen immediately, the company’s coffers were boosted by 6% to nearly £4.5bn, helping Orange to achieve profits of £1bn in the UK last year.
Orange has been credited as having the lowest prices in the market after a tariff refresh in the middle of the year. But by also spending heavily on commissions for Carphone Warehouse and Phones 4u, as well as overlaying its deals with PlayStation3 consoles in its own stores, it is widely reckoned to have taken a big hit on its margins.
A spokesman for Orange said: ‘We had a pretty bad first quarter, but then for the rest of the year we steadily added new contract customers.
‘We are the second biggest revenue contributor to our parent company France Telecom, which is great.
‘We were very aggressive in the market and now we are reaping the benefits.’