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    O2 shows voice ARPU declines


    Overall picture fairly stable – voice down, data up

    Voice ARPUs showed further decline across O2’s European territories, as data revenues grew slightly during the first quarter if 2010. Although the rate of decline has slowed, the overall picture is that voice revenues are dropping, driven in some cases by cuts in moble termination rates.

    Telefonica O2 Germany was the star performer in terms of growth for the Telefonica O2 properties in Europe during the first quarter of 2010.

    The German unit grew operating revenues 9% year-on-year, not including HanseNet, and saw net additions grow 16% year-on-year, with contract net additions up 31% year on year. Operating income was up 13%.

    Total ARPU, however, declined 6.6%, to reach €14.8 in the first quarter. Voice ARPU was influenced by mobile termination rate cuts to fall 12.5% year on year, while data ARPU grew 7.5%.

    In the UK, Telefonica claimed “underlying” growth in services revenues, meaning that it has excluded the impact of mobile termination rates cuts from its numbers. If MTR rate cuts are discounted then the UK unit grew revenues 9.3% year on year and achieved operating income growth of 7.3%. Customer growth not including Tesco Mobile MVNO) grew to 21.4 million customers, up 4.6%.

    Total ARPU declined 3.1% in the quarter to give a number of €24, although that was an improvement on 2009 1Q, where total ARPU was down 4.5%. Voice ARPU dropped 9% year on year, with data ARPU up 7.2%.

    Total ARPU in Ireland was at €37.4, a decline of 5% year on year and also down 7.3% from the previous quarter (4Q 2009). Again, it was voice that showed the biggest decline, dropping 8.5%, with data showing a small increase at 3.5%.