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Vodafone sees TV subscribers dip but convergent base grows

VodafoneVodafone saw its TV base hit by losses in Spain in the quarter to June, but the group claimed success from its marketing of fixed-mobile convergent offerings.

Vodafone overall had 9.6 million TV homes in Europe at the end of June, or 13.5 million including the VodafoneZiggo joint venture in the Netherlands.

The company said that it now had 3.8 million converged homes – meaning homes that took both fixed and mobile services, up 700,000 year-on-year. Including VodafoneZiggo, the number was 4.4 million.

By comparison, Vodafone had 16.8 million broadband customers in Europe at the end of June, and 50.1 million 4G mobile customers.

In Spain, Vodafone’s TV base fell by 24,000 over the quarter, which the company attributed in part to a temporary delay in being able to offer the service to its wholesale footprint in agreement with Telefónica. Other factors included disconnections following the end of the football season and a new emphasis on selling premium packages.

Vodafone One, the company’s converged fixed, mobile and TV offering in Spain, reached 2.4 million homes at the end of June, up 63,000 during the quarter. The company also launched a basic convergent offering via its low-cost brand Lowi in May.

Vodafone added 15,000 fixed broadband customers and 55,000 contract mobile customers in Spain during the quarter.

Vodafone said that average revenue increased and churn fell for households that took its converged products.

Vodafone’s TV base in Germany was stable at 7.7 million. The company’s GigaKombi convergent offering sighed up 90,000 households during the quarter, taking the total converged homes to 500,000.

Vodafone said that added 100,000 broadband customers in the quarter in Germany, including 65,000 on cable.

Vodafone Portugal meanwhile reported that its OTT TV service was now seen by 500,000 customers, boosted by a stronger programming offer including Sporting TV and new channels from AMC.

In Europe as a whole, 30% of Vodafone’s fixed broadband subscriber base is now ‘converged’. In Spain, the proportion is 88%, far ahead of other territories in which the company is present. The other market where Vodafone has successfully marketed convergence to its fixed base is the UK, with 77% of fixed customers being converged. However, the UK fixed base is extremely small compared with the overall mobile base.

In Germany, only 8% of fixed broadband customers are converged, while in the Netherlands, where the merger with Ziggo was intended to capitalize on convergence above all else, the figure is 21%. In Italy, 26% of fixed customers take a mobile service, while in the rest of Europe, the figure is 28%.

Overall, Vodafone posted revenues of €11.474 billion for the quarter to June, down 3.3%, including €8.299 billion in Europe, down 4.8%.

“We have made a good start to the year in Europe, where our commercial momentum remains robust, and growth accelerated across AMAP. Although competition in India remains intense, service revenues stabilised compared with the prior quarter. Our substantial investments in network leadership, an excellent customer experience and even greater ‘more-for-more’ propositions for customers are enabling us to monetise strong demand for mobile data,” said CEO Vittorio Colao.

“We are gaining profitable market share in broadband, and a growing proportion of our customers now take our fully converged offers. Our world-leading Internet of Things platform contributed to another quarter of solid growth in Enterprise. In addition, we are executing our ‘Fit for Growth’ cost efficiency programme in line with our plans. Overall, this performance gives us confidence in reiterating our outlook for the year.”