"On track" Vodafone breaks 150-million barrier

But still questions being asked about Japanese business

Vodafone has announced it has passed the 150-million customer mark and characterised its progress as "in line with expectations".

Despite adding 5.4 million customers, the Newbury-based mobile phone operator isn't the world's largest by user numbers but it is the farthest-reaching and most closely watched. For the quarter ending 31 December 2004, operations in Germany and Italy - which had previously experienced hiccups - showed solid growth in service revenue of six and eight per cent respectively.

UK figures were hit by reductions in termination rates but still recorded three per cent growth, as opposed to seven per cent excluding those reductions.

Vodafone CEO Arun Sarin in a conference call this morning said the three months are "the best quarter since December 2000, up 25 per cent year-on-year".

The company has not changed its guidance and is pleased with the progress of its Vodafone live! integrated content offering, now in 20 markets and available in some over 3G networks, allowing functions such as downloading of songs, something that's now been done around 600,000 times, according to Sarin.

However, questions remain over Japan, where the operator entered the market by acquiring J-Phone but was last to launch 3G behind rivals NTT DoCoMo and KDDI.

Sarin said: "We get our highest ARPUs [average revenue per user] from Japan… We have 18 per cent market share [but] because we were late in 3G we lost our footing a little bit but we're onto that."

He dismissed suggestions that Vodafone might exit the Japanese market, saying it remains "core" and the company is "on track but with work to do".

Vodafone is in the middle of a widely publicised 18- to 24-month turnaround plan in that market addressing 3G, distribution and cost cutting through better use of billing and other operations.