MmO2 to Push the 3G Boat Out in Germany

November 15, 2004 - source: BWCS

Former BT mobile wing, mmO2 is set to pour £500 million into supporting its German 3G network. The vote of confidence in its German operations came as the company prepared to pay its shareholders a dividend for the first time.

Opinions had been divided over the wisdom of progressing with its 3G plans in Germany, Europe’s largest mobile hone market. Despite recent improvements in its customer figures, mmO2 remains the smallest of Germany’s quartet of mobile phone operators. Until the announcement it had been supposed that the UK-based company would continue to rely on its 3G network sharing scheme with T-Mobile of Germany. However, this option has become increasingly unattractive for mmO2 as its own subscriber base has grown.

The importance of Germany to the UK mobile group is underlined by the fact that the country now accounts for 27% of mmO2’s total revenues. It is fast catching up KPN, the Dutch-based, third-placed operator in the country. KPN currently boasts eight million mobile users in Germany, whilst mmO2 now has around 6 million subscribers, which equates to 9% of the total market.

MmO2’s CEO Peter Erskine, is expected to announce later this week that his company will finally pay out a dividend of around £0.02 to all shareholders. Profits at the mobile operator are set to double this year to £242 million. Revenues from operations in Germany during the first half of this year rose by 20% to £900 million.