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Vodafone Consolidates UMTS Market Leadership and Enters the Fixed Network Market PDF Print E-mail
Tuesday, 30 May 2006

Vodafone brought the financial year from April 2005 to March 2006 to a positive close, despite price erosion and tougher competition, and it has also recorded further growth in customers, turnover and profits. The new multimedia services that have been available since last year thanks to UMTS made an important contribution to driving this growth. Fixed network substitution with the Zuhause product family is also rapidly gaining in popularity, and Vodafone will be building on this success in the coming financial year.

"Two things will be decisive for Vodafone Germany's future growth: UMTS and fixed network substitution. Over two million UMTS customers and the extremely popular UMTS services underline our market leadership. And, in the long term, we want to extend our market share from mobile communications to fixed network products and services in the long-term. 630,000 customers already use Vodafone Zuhause today. This year, we will go one step further and introduce an all-inclusive package of mobile communications and DSL broadband Internet access," said Friedrich Joussen, CEO of Vodafone D2 GmbH.

Vodafone managed to achieve 1.2 percent growth in its German operations during the 2005/2006 financial year, despite low overall economic growth and high penetration of the mobile communications market. Vodafone Germany realised total turnover of EUR 8.44 billion (GBP 5.75 billion). It was able to keep costs stable and increase profit (EBITDA) by over two percent to EUR 3.96 billion (GBP 2.7 billion). The EBITDA margin has also risen by half a percent to 47 percent since last year. Over the course of the year, the number of customers increased by 2 million to 29.2 million, only slowing in the final quarter from January to March 2006 when there was a net increase of 26,000.

There has been a substantial increase in the number of UMTS customers. Over two million UMTS customers make it obvious that Vodafone is the number one UMTS provider. One year previously, Vodafone only had around 360,000 UMTS customers in Germany. 1.8 million of these 2 million customers are UMTS phone users and over 200,000 have a laptop with UMTS Mobile Connect Card. The new UMTS services such as Mobile TV and Mobile Music are very popular. Last year, over 3 million songs were downloaded to UMTS phones and the new UMTS services have also boosted sales of data services over the course of the year. Data services, including SMS/MMS, accounted for 21.7 percent of total turnover in the last quarter (19.8 percent in the same quarter of the previous year). The portion of total turnover generated by data services alone, not including messaging (SMS and MMS) increased to 5.7 percent last quarter. Data services not including SMS/MMS messages generated over EUR 370 million over the year as a whole, which is 57 percent higher than last year's result. Average revenue per user (ARPU over a 12-month period) has declined from EUR 24.9 to EUR 23.3.

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