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Thursday, 11 October, 2001, 18:29 GMT 19:29 UK
BT shares fall on poor mobile figures
O2 logo
The coming of O2 may herald further BT spin-offs
British Telecom shares fell 9% after a disappointing set of figures cast doubt over its soon-to-be-spun-off mobile arm MMO2.

BT said virtually all its recent mobile customer growth had come in the less-profitable pre-pay sector.

Most rival operators are shunning the fickle pre-pay market in favour of more profitable contract customers.

The figures also showed customer growth had virtually stalled in Germany, at BT's Viag Interkom division.

The only bright spots were BT's Dutch operation, Telfort, and a growth in users of its Genie internet service, which saw a 50% increase in WAP page impressions.

Analysts' reaction

BT's mobile business is to floated off and renamed MMO2.

The move is likely to be the first of a series of spin-offs as BT gets to grips with its crippling debts.

MMO2 is due to obtain a stock market listing on 19 November.

But analysts are sceptical about the plan, with most believing MMO2 will become an instant take-over target.

BT Cellnet saw a net increase of 78,000 customers to 11 million - but the number of contract users fell 17,000.

The company was outperformed by smaller rival Virgin Mobile, which claims its customer base has grown by 172,000 to almost 1.2 million.

Virgin Mobile, a 50-50 joint venture between Sir Richard Branson's Virgin Group and Germany's T-Mobile, parent of the One2One network, claimed year-on-year customer growth of 34%.

BT's shares fell 34.75p at 340.25p, leading other telecoms firms to fall, with Cable & Wireless down 10p at 284p and Vodafone off 4.25p at 161.25p.

The falls weighed on the market, and the FTSE 100 Index closed up just 11.8 points at 5164.9 - after earlier surging by 126 points.

See also:

24 Sep 01 | Business
BT chiefs mull total split-up
19 Sep 01 | Business
BT loses enquiries monopoly
05 Sep 01 | Business
Mall disputes BT name change
03 Sep 01 | Business
BT unveils new mobile brand
02 Sep 01 | Business
BT heads for November demerger
27 Aug 01 | Business
BT Wireless 'to axe 1,500 jobs'
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