iPhone 3G helps boost O2 sign-ups

The Spanish-owned UK operator signed up three-and-a-half times as many new mobile customers in the third quarter 2008 as in the same quarter last year

O2 UK added three-and-a-half times as many new mobile customers in the third quarter of this year as it did in the same quarter last year.

The mobile operator's Spanish parent, Telefonica, published its financial results on Friday, showing O2 UK had its best-ever third quarter in 2008. According to the results, O2 UK now has 19.1 million mobile customers, which is 6.6 percent more than it had in the third quarter of 2007 and by far the largest mobile-customer base in the country.

O2's growth was largely down to the iPhone 3G — a handset on which O2 has UK exclusivity — and the operator's Simplicity pre-pay tariffs, Friday's statement suggested. According to Telefonica, O2 UK's new regional sales structure also helped drive strong performance in the small-business market.

"The small-business segment delivered a best-ever quarter, benefiting from a new regional strategy to bring us closer to customers, a market-leading set of partner programmes designed to jointly address growing market segments and the introduction of bespoke service offerings (Premium Business) targeted at larger businesses," Matthew Key, Telefonica Europe's chairman, said in the statement.

The results also showed fewer customers were leaving O2 in the third quarter of this year than in the same quarter last year, with 'churn' down from 1.7 percent to 1.3 percent. The operator attributed this fall to its "customer satisfaction scores".

Although voice-related average revenue per user (ARPU) fell, total ARPU remained static because data ARPU continues to increase, Telefonica said. Data ARPU was 8.9 percent higher year-on-year, thanks to a significant increase in usage of the mobile internet, the company said. Non-SMS-related data revenues increased 61.1 percent year-on-year.

In the fourth quarter, O2 will continue to upgrade its high-speed 3G (HSDPA) network across the UK to 3.6Mbps, and in certain areas to 7.2Mbps.

O2 UK now has a DSL broadband customer base of 267,090, the results indicated. Of this total, 72,870 joined up in the third quarter of this year — a 16 percent increase over the same quarter last year.

Overall, O2 UK's revenues grew by 8.7 percent year-on-year, with mobile service revenue increasing by 9.6 percent year-on-year.