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Vodafone's customer numbers fall to lowest since December 2008

Wednesday 9th November 2011

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Vodafone New Zealand’s customer numbers have dropped to their lowest since December 2008 as the country’s biggest mobile phone operator deals with mounting competition from rival Telecom’s XT network and new entrant Two Degrees Mobile.

Auckland-based Vodafone had 2.434 million customers as at Sept. 30, down from 2.458 million at the end of June, according to its London Stock Exchange-listed parent’s quarterly statement. The phone company shed 24,000 customers in the quarter, adding to the 26,000 lost in the previous quarter.

Vodafone has been losing customers almost every quarter from a peak of 2.511 million New Zealand customers in September 2009, though it’s kept the biggest market share at about 47.6 percent.

Rival Telecom also shed customers in its latest reported period, with total mobile customers at 2.097 million at the end of June from 2.192 million three months earlier. Still, Telecom has been gaining ground with its XT network, adding 173,000 customers to 1.183 million, meaning most of the loss has been migration away from its obsolete CDMA network.

At the same time, 2Degrees has grabbed about 11 percent of the market, with its latest update in March showing it had some 580,000 customers.

Still, Vodafone continued to migrate more customers on to monthly payment plans, with the percentage of traditionally lower value pre-paid contracts down to 67.2 percent.

Last month, the phone company’s New Zealand subsidiary reported annual profit of $151.5 million in the year ended March 31, up from $121.6 million a year earlier. The bulk of the gain came from a cheaper depreciation and amortisation bill.

Vodafone expects 2012 earnings to drop by $55 million after the Commerce Commission imposed a reduction to mobile termination rates, the amount operators charge each other to end a call on a rival network.

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