Vodafone has released its Q2 subscriber figures.
Mobile giant Vodafone has announced its figures for Q2 2002. Total subscriber numbers were up 2.7 million on April to reach 103.9 million, despite falls in the UK and Germany, where Vodafone has been disconnecting low-usage consumers to boost ARPU.
Unsurprisingly, ARPU rose by E4 in Germany and E3 in the UK. In Japan and Italy, where subscriber numbers are growing, ARPU was flat. These figures, though hardly impressive, were roughly in line with market expectations, driving Vodafone shares up. But what’s the outlook for the next few months?
Vodafone has had some success at boosting data revenues – they’re now up to 14% of the total. The vast majority of this is from SMS messaging; indeed, the proportion of wireless Internet revenues shrunk in the UK. The wider roll-out of MMS, then the launch of 3G, should help nudge this in the right direction, bringing the company towards its target of 20% of revenues from data by the end of 2004.
There should also be a boost to ARPU this summer: for the first time, prepaid customers can use their mobiles for international roaming. Only a few international calls would be needed to raise a prepaid user’s average spending significantly.
However, over-optimism about Vodafone’s year would be unwise. Data services should boost ARPU, but the higher subsidies that MMS and 3G handsets will require will hurt short-term margins. Vodafone will gain from more widespread data uptake, but it will be no panacea.
At the same time, international and interconnection charges – reliable cash cows, given that voice calls still account for 86% of revenues – are under regulatory review in the UK and elsewhere. If regulators come down hard, then Vodafone and its peers could see voice revenues decline long before data revenues can make up the shortfall.
Related research: Datamonitor, Global Mobile Devices (DMTC0777)
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