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ISP O2 UK and BE See Slower Decline to 617800 Broadband Subscribers

Friday, May 11th, 2012 (8:48 am) - Score 1,150

Mobile operator and ISP O2 UK (Telefonica) has today released its latest quarterly results to the end of March (Q1-2012), which revealed that their fixed line broadband subscriber base (includes BE Broadband customers) had continued to decline by -2,500 (net) between Q4-2011 and Q1-2012 to reach a new total of 617,800.

The change represents another slight improvement on the -5,000 lost during Q4-2011 and the -27,600 in Q3-2011, although recent problems with the broadband platform (here) and a delay to the ISPs plans for a superfast broadband launch this year (here) could hamper any future efforts to boost fixed broadband growth.

Telefonica Statement (O2 UK)

In the first quarter of 2012 Telefónica UK continued executing its strategy to regain commercial momentum in a very competitive marketplace, leading to a significant increase in commercial activity resulting in the highest quarterly contract net additions since 2010. The Company continued its focus on the retention and acquisition of high-value smartphone customers, which, coupled with the on-going success of its smartphone tariffs, drove strong contract base growth and positive contract churn evolution.

As a result, the total access base grew 1% to stand at 23.3 million at the end of March 2012, on the back of stable mobile base and positive fixed telephony growth which compensated a year-on-year decline in retail broadband fixed internet accesses.

The mobile contract base rose steadily, increasing 5% year-on-year to account for 50% of the total mobile customer base, which reached 22.3 million at the end of March 2012. Smartphone penetration increased to 41% in the first quarter.

Revenues totalled 1,719 million euros in the three months to March 2012 (-6.0% yearon-year) impacted by a difficult trading environment and regulation. Excluding the impact from mobile termination rate cuts, revenues would have decreased 3.0% year-on-year in the first quarter, stabilising its year-on-year trend.

On a brighter note O2/BE’s fixed line phone customers continued their strong growth from 216,100 in Q4-2011 to a whopping 315,800 in Q1-2012. The operator is now known to be putting most of its focus on future “4GMobile Broadband services.

Leave a Comment
5 Responses
  1. Avatar Sheffield Owl says:

    Than will be +1 come July……No sign of any fibre so Digital Region here I come,been putting up with 2.5mb now for 3 years so its bye bye O2.In fairness to them though its not their fault I’m at the end of a long line and tbh you can’t fault their c/s.

    1. Avatar blueacid says:

      I think they’re losing a lot of customers that are in a similar position to you. These customers have a long line therefore only getting a few mbit with ADSL2+. As soon as something faster comes out (e.g. Digital Region or a BTW Fibre service) they move to this faster service, making comments that they were happy with o2/Be* but just wanting more speed than o2/Be* could supply.
      You (and almost every high paid analyst at o2/Be*) wonder what might have happened if they had brought out a fibre service using their own network, much like Sky and Talktalk have done.

  2. Avatar phantom says:

    If they had launched a FTTC product using their network and backhaul ,their network would of been more overloaded than it is currently in some parts of the country So apart from even less of their customer base being happy resulting in even more leaving them probably not a lot, they didn’t launch it or won’t because they have not got the required level of network bandwidth on a national scale nor do they have adequate peering or CDN bandwidth all this would cost a lot of money, and Telefonica ain’t got it

  3. Avatar phantom says:

    If they had launched a FTTC product using their network and backhaul ,their network would of been more overloaded than it is currently in some parts of the country So apart from even less of their customer base being happy resulting in even more leaving them probably a lot,

    They didn’t launch it or won’t because they have not got the required level of network bandwidth on a national scale nor do they have adequate peering or CDN bandwidth, All this would cost a lot of money, and Telefonica ain’t got it

    Reply

  4. Avatar Deduction says:

    The real customer losses will be seen in the second quarter.

    It was not until later than March that they announced there would be no fibre this year and the network upgrades would still be ongoing.

    People aint gonna stick around with a non-FTTC ISP or one that has a catalogue of network problems.

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