Strong 4G demand boosts EE in third quarter

LONDON, Oct (KOSDAQ: 039200.KQ - news) 22 (Reuters) - Britain's largest mobile operator EE added half a million customers to its superfast 4G service in the third quarter, boosting data revenues and encouraging more subscribers onto longer term contracts.

However, the strong demand for 4G failed to offset the overall reduction in its customer base.

EE, a joint venture between Orange (Other OTC: FNCTF - news) and Deutsche Telekom, has built up a strong lead after it rolled out its 4G service last October, almost a year ahead of rivals 02, owned by Telefonica, and Vodafone (LSE: VOD.L - news) , which launched their offerings in August.

Vodafone said earlier this month that it had signed up 100,000 clients to its 4G service.

EE, which has been touted as a candidate for either a sale or a public float next year, has now signed up 1.2 million subscribers to the offering, helping data revenues in the three months to rise by a quarter and taking its customer base on the more lucrative post-paid contracts to 56 percent.

The group has also been rewarded for its 4G headstart by strong demand from corporations such as Canon (Other OTC: CAJFF - news) and Expedia (NasdaqGS: EXPE - news) which have signed up to take the faster offering for its staff.

Despite the 4G rise, the customer base fell overall as some 345,000 clients dropped cheaper pay-as-you-go services, which EE described as in line with industry trends.

The overall reduction in subscribers meant service revenue was down 3.3 percent in the quarter, or down 0.6 percent when removing the impact of regulatory changes such as cuts to roaming charges.

The 3.3 percent fall in the third quarter was an improvement on the 4.4 percent drop recorded in the second quarter.