O2 reports 40pc increase in punters using smartphones

28 Jul 2011

Ireland is becoming a smartphone republic if O2’s results are anything to go by. During the first six months of the year, the company’s postpay customer base grew by 29,000, driven by an acceleration in the uptake of smartphones and data services.

O2’s mobile broadband customer base increased by 20,000 to reach 165,600.

As a result, mobile data revenue continued to perform strongly in the first six months of 2011, growing 11.8pc year-on-year to represent 40pc of total mobile service revenues.

The company said this growth in data has been enabled by O2’s investment in the rollout of a new 21Mbps high-speed broadband network offering significantly faster download and uplink speeds for customers.

O2’s fixed line business customer base also continues to grow, up by 7,300 for the first six months of 2011, to a current base of almost 20,000 customers.

O2’s move into ancillary services has also proved successful, with more than 40,000 customers signing up to O2’s first financial services product, the O2 Money Card, since its launch in February of this year.

Telefonica Ireland’s joint venture with Tesco – Tesco Mobile – also recently announced it now has more than 100,000 customers.

O2 service revenues for first six months of 2011

O2’s total customer base, including mobile and fixed customers, was 1.687m at the end of June 2011, down 8,200 in the second quarter.

Service revenue for the first six months of 2011 was €352m (down from €389m for the same period last year). The revenue decline is mainly driven by the better value for money products O2 is offering its customers, as well as by cuts in the mobile termination rates charged by O2 to other operators to carry calls on its network in line with regulatory changes.

Monthly average blended ARPU was down slightly quarter on quarter, from €34.4 in Q1 to €34.0 in Q2. For the first six months of 2011 it was €34.2, down from €37.1 for the same period last year.

“Today’s results show significant growth in our postpay base, up by 29,000 customers at the end of June when compared with the same period last year,” said Paul Whelan, chief financial officer, Telefónica Ireland.

“We are extremely pleased with the uptake in data which continues to be a key growth driver, now accounting for 40pc of our mobile service revenues, as more customers use smartphones and other mobile internet devices on O2’s high-speed broadband network.

“This year has also seen O2 move into cloud computing through a major strategic partnership with Microsoft. Business customers can now avail of a packaged offering where O2’s core mobile and fixed services will be offered with Office 365, Microsoft’s new cloud productivity solution.”

“From a macro perspective, economic conditions remain extremely challenging, with consumer sentiment taking longer than expected to recover. In response, we continue to innovate and extend our range of price plans, focusing on the value and flexibility that we know our customers want. In particular, our new O2 Simplicity tariff, available on a flexible 30-day rolling contract is proving extremely popular,” Whelan said.

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years