Wireless Federation

The Portugal Telecom Industry reported its third quarter results. The subscriber base reaches to 14.5 million, a 1.5 percent increase on the previous three months and 12.4 percent more than in the same period in 2007, as per the recent data. Post-paid users represent more than 25 percent of the total, or 3.67 million. The operator adds 216,000 new subscribers, taking to 1.6 million the number of additions over the past 12 months. 1.97 billion Calls were made from mobile, up 7.4 percent on the previous quarter and 1.95 billion were received, up 6.1 percent on the second quarter. The number of SMS messages sent grows to 3.8 percent to 6.087 billion. The mobile penetration rate in September stood at 137 percent.

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Telefonica O2 Ireland reported a drop of 3.4 % to €234 million in service revenue for the three months to the end of September compared with the same period last year. For this quarter, ARPU showed a decline to €43.70 compared with €47 for the same three-month period in 2007. The operator adds 26,000 new customers and its subscriber base reaches to 1.73 million. Customer numbers are up 5 per cent year-on-year, the company said.

During the three-month period, a total of 609 million text messages were sent, representing a 55 per cent rise in text usage year on year, up from 393 million in the third quarter of 2007. ARPU for the postpay customers drops from €84.90 (2007) to €72.20. Paul Whelan, chief financial officer, Telefónica O2 Ireland, said ARPU had fallen due to “extra value” being offered to customers. The telecoms sector faced the same economic pressures as other sectors and predicted this Christmas would “a lot tougher than previous years, he added. The mobile phone penetration have reached 120%, Whelan said that the “phenomenal growth” in mobile phone penetration was coming to an end.

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Mobily, prepaid and postpaid subscribers can enjoy halved rates on all Mobily national and international calls at any time of the day. The offer is valid till Dec. 4. Mobily has announced that a local call minute will cost as little as 15 halalas for postpaid subscribers and a meager 10 halalas for preferred numbers, starting from the moment the “dial” key is pressed. The same applies to preferred numbers as well.

Prepaid subscribers will have to pay only 27.5 halalas per minute on the click when they call other Mobily numbers. The rates to other networks remain unchanged. A press release issued, Mobily reiterated its keenness to have the simplest, best possible offers “with no fine print or hidden charges to worry about.”

According to the firm, the real test for any network is its ability to handle increased traffic, whether during promotions or on special occasions including holidays and Haj season. The concerned authorities have approved all of Mobily’s offers. The operator is introducing several consecutive offers to keep its rates the lowest in the Kingdom for the benefit of its subscribers, the latest of which was a 60 percent rate cut on all national calls, regardless of network, after the third minute of every call placed.

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With the implementation of MNP in Turkey, Turkish mobile operators have launched promotional campaigns aimed at an estimated 10 million mobile subscribers who want to take advantage of this service. According to a media report, Avea and Turkcell organised music concerts as well as launched incentives programs to attract new users. New Avea prepaid customers will receive 250 credits, which can be used to dial all service providers, and new postpaid subscribers will be able to subscribe to the ‘300 to everywhere’ package, which includes 300 monthly anytime minutes for TRY 30 per month. The portability campaign by Turkcell started with the slogan ‘Your number will remain the same, its quality will be Turkcell’. A new incentive program has been initiated by Turkcell under which users can speak for free to other Turkcell members for two days a week. This offer will be available to the first 1 million Turkcell members who register by SMS between 8 November and 28 December. Vodafone Turkey in the same line launched a campaign and offers corporate users free calls and minutes between corporate numbers. According to Vodafone, it will launch more campaigns soon.

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T-Mobile USA, reported third quarter 2008 results.  At the end of the quarter, T-Mobile USA had 32.1 million customers, adding 670,000 net new customers during the third quarter, and OIBDA of $1.53 billion, up 8% compared to the third quarter of 2007.

“In the quarter, T-Mobile took giant steps forward in driving new innovations to meet the pressing needs of our customers,” said Robert Dotson, President and CEO, T-Mobile USA.  “We introduced our customers to the T-Mobile @Home® landline replacement service at a time when saving money is a top priority for American households.  We also established our new nationwide high-speed 3G services, which will cover 120 cities by the end of November.  This network introduction was accompanied by the unveiling of the T-Mobile G1 with Google, the world’s first device built on the fully open Android operating platform giving consumers access to some of the most innovative mobile applications to ever come to market.  These and other innovations are helping us aggressively compete as we debut new and craved-for services that truly meet customer needs and inspire greater long term loyalty to our brand.”

“T-Mobile USA continues to be one of the strong growth drivers for Deutsche Telekom,” said René Obermann, Chief Executive Officer, Deutsche Telekom.  “With the introduction of its 3G network in the U.S. and the successful launch of the T-Mobile G1 with Google, T-Mobile USA is now in an excellent position to further leverage the enormous potential of mobile data in its market.”

Customers

* In the third quarter of 2008, T-Mobile USA added 670,000 net new customers, up from 668,000 in the second quarter of 2008, and down from 857,000 in the third quarter of 2007.
* The number of net new customer additions was consistent sequentially, despite higher gross customer additions. This is primarily due to higher contract churn, as explained below. Gross customer additions were higher both sequentially and compared to the third quarter of 2007. This is a reflection of successful products such as myFavessm, FlexPaysm - an innovative hybrid plan that combines elements of traditional postpaid and prepaid plans, and T-Mobile @Home, a landline replacement product that was launched at the beginning of the third quarter of 2008.
* Contract customer net additions decreased in the third quarter of 2008 making up almost 44% of customer growth, down from 80% in the second quarter of 2008 and 65% in the third quarter of 2007.
* Prepaid net additions were 377,000 in the third quarter of 2008, up from 143,000 in the second quarter of 2008 and 300,000 in the third quarter of 2007. The sequential increase in prepaid net customer additions was due to improved prepaid churn and higher reseller net customer additions. The majority of prepaid net additions in the third quarter of 2008 were FlexPay no-contract customers, which typically have a higher ARPU than legacy prepaid customers, as discussed below.
* Contract customers comprised 83% of T-Mobile USA’s total customer base at September 30, 2008. T-Mobile USA ended the quarter with 32.1 million customers.

Churn

* Contract customer churn was 2.4% in the third quarter of 2008, up from 1.9% in the second quarter of 2008 and 2.0% in the third quarter of 2007.
* The sequential increase in contract churn was primarily due to the continued impact of customers coming to the anniversary of their two-year contract that was first introduced in April 2006. The second quarter of 2008 was the first quarter these two-year contracts could have expired. Competitive pressure also contributed to the sequential increase in contract churn.
* Blended churn, including both contract and prepaid customers, was 3.0% in the third quarter of 2008, up from 2.7% in the second quarter of 2008 and 2.9% in the third quarter of 2007.

OIBDA and Net Income

* T-Mobile USA reported OIBDA of $1.53 billion in the third quarter of 2008, down from $1.58 billion in the second quarter of 2008 and up from the $1.41 billion in the third quarter of 2007.
* The sequential decrease in OIBDA was primarily due to higher customer acquisition costs, as commissions expense increased due to volumes, and higher general and administrative costs.
* OIBDA margin was 31% in the third quarter of 2008, down from 32% in the second quarter of 2008 and the third quarter of 2007.
* Net income for the third quarter of 2008 was $442 million, down from the $452 million in the second quarter of 2008 and $526 million in the third quarter of 2007.

Revenue

* Service revenues were $4.91 billion in the third quarter of 2008, up from $4.85 billion in the second quarter of 2008, and $4.33 billion in the third quarter of 2007.
* The increase in service revenues year over year was primarily due to the growth in contract customers, including the impact of the SunCom Wireless acquisition.
* Total revenues, including service, equipment, and other revenues were $5.51 billion in the third quarter of 2008, slightly up from $5.47 billion in the second quarter of 2008 and $4.89 billion in the third quarter of 2007.
* The acquisition of SunCom, and its second full quarter consolidation in T-Mobile USA’s results, contributed $192 million to total revenues in the third quarter.

ARPU

* Blended Average Revenue Per User  was $52 in the third quarter of 2008, consistent with $52 in the second quarter and down from $53 in the third quarter of 2007.
* Contract ARPU was $55 in the third quarter of 2008, consistent with the second quarter of 2008 and down from $57 in the third quarter of 2007.
* The decrease in contract ARPU year over year was primarily due to lower usage based revenues from contract customers.
* Prepaid ARPU was $24 in the third quarter of 2008, up from $23 in the second quarter of 2008 and $18 in the third quarter of 2007.
* The increase in prepaid ARPU is due to the success of higher ARPU of FlexPay no-contract compared to legacy prepaid products.
* Data services revenue (as defined in Note 1 to the Selected Data, below) was $850 million in the third quarter of 2008, representing 17.3% of blended ARPU, or $8.90 per customer, compared with 16.6% of blended ARPU, or $8.60 per customer in the second quarter of 2008, and 15.4% of blended ARPU, or $8.10 per customer in the third quarter of 2007. Data services revenue increased 28% year over year.
* Growth in messaging revenue continued to be the most significant driver of data ARPU, as customers continue to move towards purchasing plans that include messaging, including our unlimited voice and data plans. The total number of messages on the T-Mobile USA network increased to almost 49 billion in the third quarter of 2008, compared to 41 billion in the second quarter of 2008 and 21 billion in the third quarter of 2007.
* Strong GPRS / EDGE access and usage through continued growth in converged device users was another significant driver for increased data revenues.

Capital Expenditures

* Cash capital expenditures (see note 7 to the Selected Data below) were $956 million in the third quarter of 2008, compared with $1,062 million in the second quarter of 2008 and $500 million in the third quarter of 2007.
* The year over year increase in capital expenditures is primarily due to the build out of T-Mobile USA’s 3G (UMTS / HSDPA) network as well as cash payment timing differences.
* T-Mobile USA continued its commitment to improve coverage in the third quarter of 2008, adding approximately 900 GSM/GPRS/EDGE new cell sites, bringing the total number of cell sites at the end of the quarter to 42,900.
* T-Mobile USA ended the quarter with 14,700 3G capable cell sites (included in the 42,900 total cell sites above).

Stick Together Highlights

* On September 5, 2008, T-Mobile USA launched the T-Mobile products and services in the previously branded SunCom markets, including Puerto Rico. Additionally, all major SunCom systems have been integrated into T-Mobile USA as of the end of the third quarter of 2008.
* On October 17, 2008, T-Mobile USA, Inc. announced that it continues to aggressively expand its third-generation (3G) wireless broadband service in more than 120 major cities by the end of November.On October 30, 2008, T-Mobile added Washington D.C. as the latest major population centerto benefit fromT-Mobile’s 3G service.
* On September 23, T-Mobile USA announced the launch of the world’s first AndroidTM-powered mobile phone in partnership with Google. Available in the fourth quarter 2008 only for T-Mobile customers in the USA, the T-Mobile G1 combines full touch-screen functionality and a QWERTY keyboard with a mobile Web experience.
* In order to provide more options to customers, on October 8, T-Mobile began offering postpaid month-to-month rate plans without a requirement for customers to sign an annual contract. All postpaid rate plans including single line, FamilyTime, and myFaves are available under this new service option.
* In August, T-Mobile USA launched the feature of Family AllowancesSM which allows parents to give their family members an upfront monthly wireless allowance that works on all the phones T-Mobile offers - virtually eliminating the worry of surprise overages.

About T-Mobile USA:

Based in Bellevue, WA, T-Mobile USA, Inc. is the US operation of Deutsche Telekom AG’s  Mobile Communications Business, and is a wholly-owned subsidiary of T-Mobile International.

T-Mobile USA’s innovative wireless products and services help empower people to connect effortlessly to those who matter most.  T-Mobile USA’s GSM/GPRS/EDGE 1900 voice and data network, when combined with roaming and other agreements, reaches 286 million people in the U.S.  In addition, T-Mobile USA operates one of the largest Wi-Fi (802.11b) wireless broadband (WLAN) networks in the country (including roaming sites), available in approximately 9,700 convenient public access locations nationwide.
For more information, please log on to  www.t-mobile.com.

About Wireless Federation

Wireless Federation is an industry research conglomerate headquartered in London, United Kingdom. The mandate of the Wireless Federation is to provide its members and customers industry knowledge that can further enhance their understanding of the wireless industry. Wireless Federation conducts bespoke research and produces boxed reports in collabaration with Industry Bodies, Telecom Operators for Issues that revolve around ARPU, CHURN and Loyalty.
They have been associated with more than 225 mobile operators globally to set their Pricing/ Tariff Strategies, Go-To-Market Strategies for Mobile Advertising, Mobile Payments, Cutting VAS among others amongst 59 countries globally.

For more information you can log on to www.wirelessfederation.com

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Vodacom Tanzania in association with Research In Motion (RIM) launch the BlackBerry solution to its subscribers across the country. BlackBerry Curve 8310 and BlackBerry Pearl 8110 will be instigated by the operator for both pre-paid and post-paid customers that allows them to access e-mail (including attachment viewing), phone, messaging, organiser, web, multimedia and other applications while on the move. Pre-paid account for TZS36,000 for 30 days, rising to TZS99,000 for 60 days or TZS180,000 for 180 days is offered by Vodacom Tanzania. Vodacom post-paid account will cost TZS36,000 per month for a consumer package or TZS54,000 for a BlackBerry Enterprise Service subscription plan - which includes BlackBerry internet service access for free.

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Bharat Sanchar Nigam Limited (BSNL) has slashed its international call tariff to some of the South Asian Association of Regional Cooperation (SAARC) nations, including Bangladesh, Bhutan, the Maldives and Pakistan, from mobile and fixed-line phones. The new tariff will be in effect soon. BSNL subscribers can call to the SAARC countries at Rs 9 per minute instead of the existing Rs 10 for users of BSNL’s post-paid plan 725. Postpaid and Prepaid users wil lcost at Rs 9 per minute instead of Rs 12.

TRAI earlier said, the SAARC region could replicate the European Union (EU) model, whereby all member states cut international roaming rates. The international roaming rates are some of the highest in the world even more expensive than those in USA and UK so it has now become an issue of concern.

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Postpaid subscribers of Safaricom will also enjoy low calling rates with it’s new promotional rate. This will allow PostPay subscribers known as Advantage subscribers to call for as low as Ksh 4 for Safaricom-to-Safaricom throughout the day.

This is in addition to the tariff reduction announced earlier in the week where Advantage subscribers who spend more that Ksh 5,000 will pay a rate of Ksh 6 per minute while those spending less than Ksh 5,000 would pay Ksh 7 per minute.

According to Chief Executive Officer of Safaricom, Mr. Michael Joseph, “We had to go an extra mile to recognize and reward our PostPay Advantage customers for their loyalty to our network. Many of these subscribers by being members of our Bonga Loyalty Program continue to benefit from rewards such as free talk time and high end handsets. We will continuously offer new and innovative benefits for all our subscribers as we endeavor to meet their needs and aspirations.”
“Over the last week alone, we have reduced the PostPay calling rates from Ksh 10 to Ksh 4 representing a 60% reduction,” he added.

This offer is valid from 17th October to 31st December’08.

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Safaricom subscribers can enjoy making calls between Ksh 3 and Ksh 8 per minute within the network and Ksh 15 to other local networks as it slashes its calling rates. With this new offer subscribers can choose rates that suit their needs at a particular time and determine their own call costs. Safaricom Chief Executive Officer Michael Joseph said that “We are lowering the cost of making calls for our subscribers by having simple, flexible and more affordable calling rates. This will give our entire subscriber base, a rate for as low as Ksh 3 and a maximum of Ksh 8 and the option to choose their own rate based on the recharge voucher value. ” The company intends to provide the best value to subscribers countrywide and it had taken time to develop the offer that locks in its 12 millionth customer. Subscribers can save up to 70% for Safaricom to Safaricom calls charged at Ksh 3 all day and all night daily after topping up with airtime worth Ksh 1000. SMS to other Safaricom lines at Ksh 2, said Joseph.
Other options available are:

• Ksh 500 top-up which will allow subscribers to call for Ksh 4 or 60% price reduction and send SMS for  Ksh 2

• Ksh 250 top-up will allow subscribers to call for Ksh 5 or 50% price reduction and send SMS for Ksh 3.

• Ksh 100 top-up will allow subscribers to call for Ksh 6 or 40% price reduction and send SMS for Ksh 3.

• Ksh 50 top up will enable subscribers to call for Ksh 7 or 30% price reduction and SMS for Ksh 3.50.

• The top-up for Ksh 20 will allow subscribers to call for Ksh 8 or 20% price reduction and SMS for Ksh 3.50.

Calling becomes cheaper for the postpaid customers as well. Based on their monthly usage the call rate lowers from Ksh 10 to Ksh 7 and Ksh 6.

Subscribers of Virgin Mobile can enjoy call across India and local at 50paise/pm with its new tariff plan for the prepaid segment without any pack or extra cost. The first three minutes of a STD call each day would cost Rs 1.50 paise per minute while for rest of the day the long distance tariff would drop to just 50 paise per minute for maximum up to 30 minutes. Similarly, for local calls, for first three minutes of the day calls would be at Re 1 per minute, then for the rest of the day the tariff would be 50 paise a minute.

CEO of Virgin Mobile India, M A Madhusudan said, “Against the industry norm of STD tariff of Re one per minute at an additional monthly commitment, ‘New 50 Paise STD- local’ will provide the lowest all-India STD base tariff offer with no extra cost”.

Targeting their youth audience, Virgin Mobile has taken a number of initiatives to offer customised and relevant offerings for its youth audience to meet their style and budget quotient. Madhusudan further said that Virgin Mobile wants to offer value and flexibility that meets the unique needs of urban youth.

“We launched in India with the ‘Get Paid for Incoming’ offer and with the launch of this plan (New 50 paise STD Local), we are delighted to set yet another benchmark in the telecom industry in less than a year. This tariff is the first of its kind in the country and is our effort to put end to distances across geographies in India,” Madhusudan accentuated.

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