nick
20-06-2004, 12:34
VODAFONE is offering half-price mobile-phone deals to prevent customers defecting to 3, the video mobile company that has kick-started its growth with aggressively low tariffs.
Customers who threaten to leave Vodafone will be offered 1,000 minutes of call time for only £37.50 a month. This is half the £75 it normally charges for its Anytime 1000 bundle.
Orange is also said to be prepared to match the tariffs available on 3, which last week won the award for best value at the Mobile Retailer Awards. 3’s VideoTalk 750, which offers 750 minutes of calls to any network for £35, was said to represent “blinding” value.
Fierce price competition is part of the reason for a sharp fall in profit margins at Vodafone UK. Recent results showed margins had slumped from 40% to less than 32%.
Vodafone said: “For some customers, we do offer 1,000 minutes for £37.50, which is competitive against 3.”
After a problem-strewn launch last year, 3 is now growing rapidly, helped by new and better phones, led by the LG 8110, which is taking almost 40% of total sales. The company, Britain’s first “third-generation” mobile operator, is thought to have more than 600,000 customers and to be on course to match the 19 months it took Virgin Mobile to reach its first 1m.
Orange insisted that 3 was having no impact on its customer numbers. “There is no evidence that our customers are turning to them more than anyone else,” said a spokeswoman.
3 said its growth had yet to show through on the numbers reported by the other operators, because of the six-month delay before customers are declared inactive. Monthly spending is thought to be steady at about £44, because of the popularity of video clips showing news, sport and its “top shelf” adult entertainment.
Customers who threaten to leave Vodafone will be offered 1,000 minutes of call time for only £37.50 a month. This is half the £75 it normally charges for its Anytime 1000 bundle.
Orange is also said to be prepared to match the tariffs available on 3, which last week won the award for best value at the Mobile Retailer Awards. 3’s VideoTalk 750, which offers 750 minutes of calls to any network for £35, was said to represent “blinding” value.
Fierce price competition is part of the reason for a sharp fall in profit margins at Vodafone UK. Recent results showed margins had slumped from 40% to less than 32%.
Vodafone said: “For some customers, we do offer 1,000 minutes for £37.50, which is competitive against 3.”
After a problem-strewn launch last year, 3 is now growing rapidly, helped by new and better phones, led by the LG 8110, which is taking almost 40% of total sales. The company, Britain’s first “third-generation” mobile operator, is thought to have more than 600,000 customers and to be on course to match the 19 months it took Virgin Mobile to reach its first 1m.
Orange insisted that 3 was having no impact on its customer numbers. “There is no evidence that our customers are turning to them more than anyone else,” said a spokeswoman.
3 said its growth had yet to show through on the numbers reported by the other operators, because of the six-month delay before customers are declared inactive. Monthly spending is thought to be steady at about £44, because of the popularity of video clips showing news, sport and its “top shelf” adult entertainment.