Broadband News
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BT, O2 revel in revealing customer gains
13 Nov 2009 | 00.13 Europe/London
BT Group and O2's parent company Telefónica have both just released their results for the past quarter. With O2 UK now having breached the half-million mark in terms of its broadband subscribers, BT Retail has revealed it now has almost ten times as many people on its books.
BT Retail's net additions were 72,000 in the quarter, taking its total number of broadband customers to 4.9 million. While the firm's retail market share in what it calls a "maturing broadband market" remained steady at thirty-five per cent, it appears optimistic for future growth. It's planning on offering a variety of bundles and discounts to its customers, saying Ofcom's move to deregulate the retail lines market during the past quarter will now give it the freedom to compete more effectively.
Meanwhile, reportedly due in part to a "seasonal slowdown in consumer demand during the holiday period," BT Vision's net additions were a comparatively mere 18,000 during the same period - and that's before you take adjustments to its database into account. After a "further cleanse" of its records system, the total number of customers for the IPTV operation was up by just 3,000 to 436,000 during the quarter. Although BT doesn't pick up on it in its results statement, the slowing customer take-up could also be in part down to BT Vision losing its sports package following the demise of Setana.
"We have had another quarter of progress but there remains a lot more to do," said Ian Livingstone, CEO of BT Group. "With total cost reductions of over £900 million in the first half, we have made significant headway towards our previous target of well over £1 billion for the full year. We now expect to generate at least £1.6 billion of free cash flow this year, compared with our previous target of over £1 billion. We are investing in the future of the business with an enhanced and accelerated programme of fibre deployment and wider roll out of faster broadband speeds, all within our capital expenditure plans."
While the writers of BT's results statement were predictably keen to emphasise the positives - like its 20Mbit/s broadband rollout, "enabled by ADSL2+ technology, which substantially increases broadband speeds for our customers, at no extra charge" and its fire optic trials - it isn't a good news. BT Retail's overall revenue declined by five per cent to £2,062 million, which the firm's mainly putting down to a reduction in income from calls and lines. And it's blaming "challenging market conditions" stemming from a "combination of the current economic climate, particularly in the business market, and competitive pressure" for that. Revenues at its Consumer division were down by six percent; Business were down by eight per cent.
But BT's not the only one with results to shout about: O2 UK's broadband subscriber figures have risen from 456,900 in June to 527,100 in September. In other words, it also added over 70,000 people to its network during the quarter. Year-on-year, the Telefónica-owned firm has seen its broadband customer base increase by around ninety-seven-and-a-half per cent - which a post on the O2 blog describes as "a huge increase from last year." "We’re happy to say it’s been a great nine months in some very tough times," it continues.
"Despite the economic downturn, we have continued to invest in the market in order to drive growth," says Matthew Key, Chairman and Chief Executive of Telefónica Europe. "We are now seeing firm evidence of mobile data taking off, with more than 5 million of our UK customers regularly accessing the internet on their phones and a 20-fold increase in data traffic on our network in the last year."
The full Telefónica results for January to September this year are available here.
BT Retail's net additions were 72,000 in the quarter, taking its total number of broadband customers to 4.9 million. While the firm's retail market share in what it calls a "maturing broadband market" remained steady at thirty-five per cent, it appears optimistic for future growth. It's planning on offering a variety of bundles and discounts to its customers, saying Ofcom's move to deregulate the retail lines market during the past quarter will now give it the freedom to compete more effectively.
Meanwhile, reportedly due in part to a "seasonal slowdown in consumer demand during the holiday period," BT Vision's net additions were a comparatively mere 18,000 during the same period - and that's before you take adjustments to its database into account. After a "further cleanse" of its records system, the total number of customers for the IPTV operation was up by just 3,000 to 436,000 during the quarter. Although BT doesn't pick up on it in its results statement, the slowing customer take-up could also be in part down to BT Vision losing its sports package following the demise of Setana.
"We have had another quarter of progress but there remains a lot more to do," said Ian Livingstone, CEO of BT Group. "With total cost reductions of over £900 million in the first half, we have made significant headway towards our previous target of well over £1 billion for the full year. We now expect to generate at least £1.6 billion of free cash flow this year, compared with our previous target of over £1 billion. We are investing in the future of the business with an enhanced and accelerated programme of fibre deployment and wider roll out of faster broadband speeds, all within our capital expenditure plans."
While the writers of BT's results statement were predictably keen to emphasise the positives - like its 20Mbit/s broadband rollout, "enabled by ADSL2+ technology, which substantially increases broadband speeds for our customers, at no extra charge" and its fire optic trials - it isn't a good news. BT Retail's overall revenue declined by five per cent to £2,062 million, which the firm's mainly putting down to a reduction in income from calls and lines. And it's blaming "challenging market conditions" stemming from a "combination of the current economic climate, particularly in the business market, and competitive pressure" for that. Revenues at its Consumer division were down by six percent; Business were down by eight per cent.
But BT's not the only one with results to shout about: O2 UK's broadband subscriber figures have risen from 456,900 in June to 527,100 in September. In other words, it also added over 70,000 people to its network during the quarter. Year-on-year, the Telefónica-owned firm has seen its broadband customer base increase by around ninety-seven-and-a-half per cent - which a post on the O2 blog describes as "a huge increase from last year." "We’re happy to say it’s been a great nine months in some very tough times," it continues.
"Despite the economic downturn, we have continued to invest in the market in order to drive growth," says Matthew Key, Chairman and Chief Executive of Telefónica Europe. "We are now seeing firm evidence of mobile data taking off, with more than 5 million of our UK customers regularly accessing the internet on their phones and a 20-fold increase in data traffic on our network in the last year."
The full Telefónica results for January to September this year are available here.