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Last Updated: Wednesday, 26 January, 2005, 17:53 GMT
Vodafone subscriber numbers soar
Vodafone shopfront
Customer numbers are still growing
Vodafone signed up a forecast-beating 5.4 million new customers worldwide in the three months covering the key Christmas trading period.

The firm said its global subscriber base had risen to 151.8 million in the three months to the end of December.

However, the key average revenue per user (ARPU) figure flagged in some markets, reflecting tough competition.

Vodafone's ARPU fell in big markets such as Germany, the UK and Japan and was flat in Italy.

The fall came despite customer numbers growing in the UK, Italy and Germany.

However, Vodafone's Japanese business disappointed, adding only 36,000 net new subscribers, a 40% fall on the previous quarter.


The increase in global customer numbers over the three-month period was ahead of forecasts, with analysts expecting a rise of between 3.9 million and 4.5 million.

Vodafone's shares closed down 0.5p, or 0.36%, at 139.25 pence.

Arun Sarin, Vodafone chief executive
Japan remains a competitive market and while we don't expect a near term recovery, we continue to see this as a very good market
Arun Sarin, Vodafone chief executive

"We have seen consistently strong performances across Europe and the US, whilst we continue to focus on our turnaround programme in Japan," said chief executive Arun Sarin.

The firm did not reveal how many customers had opted to take up the new third generation (3G) service which it launched last year, but did say that it was "very satisfied" with progress so far.

The company added that it had expected take-up of 3G to be gradual rather than a "big bang", but it expects 10 million people to have signed up to the Vodafone Live 3G service by March 2006.

The 3G technology enables users to download data at a faster rate than before, offering better quality sound, pictures and video.

In the UK, Vodafone said it had gained 641,000 net new customers overall, but ARPU dropped to 314 for the year to December against 318 in the year to September.

The firm said the fall in UK ARPU was principally due to regulatory price cuts on incoming call termination charges, which came into effect on 1 September 2004.

Japanese struggle

However, the group did voice concerns for its Japanese business.

Vodafone warned its Japanese unit, the third biggest mobile operator in the country, would struggle to meet modest revenue growth targets as a result of a delay in launching its 3G handsets in the country.

"Since our 3G handsets are late, we will not have the same sales volume, so our Japanese company has revised the target and now we're saying we're not going to be able to meet that modest growth," Mr Sarin said.

But plans to turn around its Japanese business, which is struggling to hold onto big spending customers, remain on track he added.

"Japan remains a competitive market and while we don't expect a near term recovery, we continue to see this as a very good market for us to be operating in," said Mr Sarin.

Despite a shake-up in Japan the firm is also keeping its eyes peeled for prospective takeover opportunities, particularly in the fast-growing Eastern European markets.

To that end deputy chief executive Julian Horn-Smith confirmed the firm would decide "probably within a month" whether to bid in the $2.7bn Czech state sell-off of Cesky Telecom.

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