Everything Everywhere (EE), the joint venture between Deutsche Telekom and France Télécom, remains upbeat still about its prospects – and would be more so, if only Britain’s Ofcom got off its backside and gave a clear answer on 4G. Auction of the 4G spectrum was originally announced four years ago under PM Gordon Brown’s administration but still there has been no word from Ofcom apart from yesterday’s unveiling of the proposed rules for the auction and a declaration that the first roll-out will be next year . See our previous story here.Britain – once a pace setter in mobile comms – has slipped behind Europe, the USA and Asia where there is already wide availability of 4G networks.
Meanwhile EE has been left lingering in the wings, having originally been given the nod by Ofcom in May 2012 to launch 4G this year in which its existing 1800 MHz 2G spectrum would be redeployed for 4G use.
But then Ofcom did a U-Turn and behind the scenes it’s thought the licensing authority had a change of heart after fierce lobbying from rivals – O2, Vodafone and Three UK.
It’s a lack of clarity that is hampering Everything Everywhere’s chance to make a profit.
In a half yearly trading statement released today, it was revealed how the company is still losing money with Ofcom’s procrastination adding to the burden of costly investment in networks.
Plus the cost of merging legacy Orange systems with those of T-Mobile systems.
Pre-tax loss for the first half of 2012 slumped to £104 million, more than double its £39 million loss for the same period last year.
And while revenue dipped only slightly from £3.37 billion last year to £3.31 billion this year, restructuring costs had already spoken for much of that income.
On a brighter note, EE separately revealed the proportion of contract customers using smartphones had risen to 72 per cent from 61 per cent in Q3-Q4 2011 and 91 per cent of new contract customers went for smartphones.
It had also succeeded in getting a higher number of users onto more lucrative pre-paid contracts, with half signed up and of which 79 per cent of them were contracted for two years.