Vodafone makes mobile claims ahead of hearing

14 Oct 2003

Vodafone Ireland has defended itself against claims that Irish mobile users are being ripped off, in advance of an Oireachtas Committee meeting this afternoon on the Irish mobile phone market. The operator cited research to indicate that Irish users are amongst the “most mobile” in the world and are being charged less than the European average.

At a recent Oireachtas Committee meeting on the mobile market, the Irish Consumers’ Association claimed that Irish mobile users are being ripped off and that prepaid users in particular were paying up to 400pc more for their calls than their billed or contract counterparts.

At a briefing this afternoon Vodafone Ireland CEO Paul O’Donovan said that Irish mobile users were paying average European rates for their mobile services and that the prices prepaid customers were paying are actually among the cheapest in Europe. “Irish customers are actually enjoying the best deal in Europe,” he said, indicating that for a sparsely populated country, mobile services here are amongst the most sophisticated in the world.

O’Donovan pointed out that Ireland is one of the “most mobile” markets in Europe today, with low fixed-line penetration and a population where the average age is 16pc below the equivalent European figure. He added that Irish mobile users were also amongst the highest spenders on mobile services in Europe, trailing only behind Luxembourg.

He pointed out that mobile prices in Ireland have fallen by 10pc on average for the last four years.

With Hutchison’s 3 service about to enter the Irish market on a full network infrastructure and the obligation to host a mobile virtual network operator, as well as Eircom clearly stating its strategy to enter the mobile market next year, O’Donovan pointed out that Ireland will become one of the world’s most hyper-competitive mobile markets with four infrastructure-based players targeting a population of only four million people.

Medium usage prepaid users in the Irish market, O’Donovan said, enjoyed the best value service, while peak usage contract customers got full value out of their mobiles. Prepaid customers represented 70pc of Vodafone’s customer base, with contract representing the remaining 30pc. “Minimum usage prepaid customers can have telecom services for less than the price of Eircom’s monthly fixed-line rental,” he said.

“There is no question that Ireland is one of the most developed mobile markets in the world, with one of the lowest fixed-line penetrations per head of population in Europe. Our research shows us that Irish consumers are willing to spend on technology if the price and value are right. Text messaging in Ireland is amongst the highest in the world.”

For the first time, O’Donovan revealed that average minutes per user (AMPU) amongst Irish customers were the highest in Europe at 183 minutes per customer, which is 71pc higher than the British on the O2 network, 68pc more than the Germans on O2, 45pc more than the Dutch using KPN’s network, 65pc more than the Spanish on the Telefonica network and 18pc more than the Norwegians on the Telenor network. The figures were based on internal Vodafone data and independent data from Teligen, prepared for the OECD.

O’Donovan indicated that Vodafone has invested over €600m in its Irish network since acquiring Eircell from Eircom for €4.5bn in 2001 and that the company anticipates spending a further €1bn in the coming year on its 3G network, after giving €114m to the Government for a 3G license.

“Mobile phone costs are below the European average for seven out of 10 people in Ireland,” O’Donovan concluded.

By John Kennedy