Vodafone Quarter 1 Results Show Company is Reducing Loss of Contract Customers

By: Submissions

Commenting on Vodafone's Q1 results*, Rob Barnes, head of mobiles at moneysupermarket.com, said: “Vodafone's Q1 results for 2007 show that so far this year the group has achieved a number of its objectives. In particular they have focused heavily on international and emerging markets.

“However, when compared to other networks, Vodafone's UK net subscriber growth is poor, with just 236,000 net additions since April 2007.

“One of the key measures within the UK mobile market is churn – customers leaving the network. Vodafone's churn has increased to 34.1 per cent when compared with 32.8 per cent in the same quarter last year. This also highlights that Vodafone is focusing on reducing contract mobile churn which is down four per cent since June 2006, but this has been at the expense of pre-pay churn which is up five per cent**. These figures are also further evidence of how competitive the UK market is and that customers are increasingly swapping networks for better deals and handsets.

“Vodafone 3G devices in operation have increased to 2.62 million. With 15 million*** of its subscribers not having a 3G-enabled phone, it is interesting to see Vodafone putting so much investment into 3G, even though they are not seeing much return on it yet. ”

Notes:

*http://www.vodafone.com/etc/medialib/attachments/kpis_june_2007.Par.66783.File.dat/KPIs_June_2007_FINAL.pdf

**Contract churn – June 2006 (20.1%) – June 2007 (15.9%) = 4%

Pre-pay churn – June 2006 (40.9%) – June 2007 (46%) = 5%

***17.6 million subscribers – 2.62 million 3G mobile phone users = 15 million subscribers without 3G

For further information, please contact

Rob Barnes

Head of Mobiles, moneysupermarket.com

rob.barnes@ moneysupermarket.com

07702 357536

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