4G customer numbers up, but Ofcom meddling hits profits
EE, Britain’s biggest mobile network operator, could soon pass the three million 4G customer milestone and is on track to double that number by the end of the year.
But the growth in customers switching to superfast services has yet to reflect itself in revenues which fell 3.6 per cent to £1.55 billion as EE added only 123,000 new contract customers during the three months to March. This compares to 166,000 for the same period last year.
New regulatory measures, such as Ofcom’s proposed increase to the operator’s spectrum license fee, are also a potential drag on profits. According to CEO Olaf Swantee, the actions of regulators alone burdened EE with an additional £38 million during the quarter to March 2014, largely because of the changes to roaming charge legislation and tougher rules on wholesale mobile call charges.
Meanwhile, the operator says its average revenue per user rose 2.2 per cent during the quarter as EE persuaded more of its customers over to 4G – it makes an extra £2 per month from superfast contracts compared to those on cheaper 3G. It also added 20,000 home broadband customers.