Second-quarter subscriber growth in the U.K. mobile-phone market exceeded analysts’ expectations as prepaid services continue to provide a growth engine for the industry.
“The market has been ahead of expectations since the fourth quarter” when carriers introduced aggressive prepaid pricing plans, said Jake Saunders, European wireless analyst with The Strategis Group in London. “This run will continue for some time to come because there is a big shift with competition in the prepaid market.”
J.D. Power and Associates reported in late April that three out of five U.K. consumers who had mobile service for less than one year purchased a prepaid service plan. In total, 29 percent of U.K. mobile households were on a prepaid plan.
“We now expect penetration in the U.K. to reach 35 percent by the end of this year and 50 percent within the year 2001,” commented Hans Snook, chief executive officer of Orange plc.
Vodafone AirTouch plc, the United Kingdom’s largest operator, reported 6.2 million customers as of June 30, adding more than 587,000 net new customers in the second quarter compared with 206,000 added the previous year. The carrier’s Pay As You Talk service grew by more than 654,000 in the quarter, taking the total prepaid base to more than 2.5 million.
“The unprecedented growth in mobile telephony that we have seen around the world this year has continued throughout the last quarter in all our major markets,” said Chris Gent, chief executive of Vodafone AirTouch. “Especially encouraging is an increasing trend of usage amongst prepaid users, particularly in the U.K.”
BT Cellnet ended the quarter with 5.02 million customers, adding 360,000 prepaid customers and 141,000 post-pay customers. Cellnet said prepaid buyers are becoming more discerning so it introduced earlier this month tailored prepaid service plans aimed at mass consumers and small business customers. The new offerings add to Cellnet’s existing prepaid packages aimed at the 16-to-24-year-old market and users who want minimal financial commitment. The carrier also introduced flat-rate pricing across 14 European countries.
Personal communications services operator Orange said it added 430,000 subscribers in the second quarter, recording 3 million total subscribers-973,000 of which were prepaid customers. Orange said 44 percent of its growth was on contract-based tariffs, such as the Everyday 50 package, launched June 1, that offers off-peak national calls for a low per-minute price.
Orange announced it will launch Internet access and Wireless Application Protocol-enabled phones during the fourth quarter. The carrier plans to launch High Speed Circuit Switched Data, increasing speeds on its wireless network from 9.6 kilobits per second to 28.8 kbps. Orange said it will introduce on Aug. 1 six new simplified pricing plans that offer more inclusive minutes to both personal and business customers.
One 2 One, which was put up for sale by owners Cable & Wireless plc and MediaOne in March, said it added 401,000 customers during the second quarter, a 151-percent increase from 160,000 subscribers the previous year. One 2 One ended the quarter with 2.6 million customers. Prepaid customers accounted for 70 percent of the net growth, said One 2 One.
“The launch of our new Anytime tariffs offering both pre- and post-pay customers 10 pence and 2 pence per minute call rates has been highly successful and is attracting significant levels of customers to our Up 2 You prepayment service,” said Tim Samples, managing director of One 2 One.
