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O2 UK and BE Reach 700k Fixed Line Broadband ISP Subscribers

Posted: 06th Aug, 2010 By: MarkJ
o2 uk logoMobile operator and ISP O2 UK ( Be Broadband ) has released its latest second quarter results to the end of June 2010, which saw their total fixed line broadband subscriber base climb from 632,400 in Q1-2010 to reach the milestone of 700,000 at the end of Q2 (+42.3% year-on-year growth).

Telefonica (O2 Parent) Statement

Total mobile customer base (excluding Tesco Mobile) increased 4.5% year-on-year to reach 21.6 million customers at the end of June, 2010, driven by the strong expansion in the contract segment (+11.7% year-on-year). At the end of June 2010, 47% of the mobile customer base was in contract.

First half of 2010 saw continued improvement in financials, with revenue growth of 4% year-on-year in local currency to reach 3,416 million euros (+6% year-on-year in local currency in the second quarter, accelerating over the 2.1% year-on-year growth posted in the first quarter).

Operating income before depreciation and amortization (OIBDA) totalled 883 million euros in the first half of 2010, recording a 7.7% year-on-year growth in local currency (+8.1% year-on-year in local currency in the second quarter).

CapEx increased 30.7% year-on-year in local currency in the first half of 2010 to 347 million euros, reflecting the continued investment in the mobile network to give customers the best user experience. Operating cash flow (OIBDA-CapEx) for the first half of 2010 totalled 536 million euros.

The adjustment represents a return to form for O2 UK, which had seen its fixed line broadband (Telefonica calls it "wireline") growth slow after only adding +40,886 new ISP customers between Q4-2009 and Q1-2010. Telefonica doesn't publish exact figures anymore but the jump between Q1 and Q2-2010 would have to be at least +67,600 to reach 700,000.

We suspect that much of this would be down to two key factors. Firstly the launch of O2's popular new Home Phone (line rental + voice calls) service and related broadband bundles. Second would be their big advertising push last month, including some major TV promotions.
Telefonica Results (PDF):
http://pressoffice.telefonica.com/documentos/nprensa/1H2010_Results_Press_Release_EN.pdf
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