Mobile connections leap in last quarter

By RICHARD BRADDELL

WELLINGTON - One in three people now own a mobile phone following a 19 per cent jump in new connections in the December quarter.

Based on figures released by Telecom and Vodafone, New Zealand's 3.8 million population has signed up for more than 1.25 million mobile phones, a rise of 201,000 from the September quarter.

Runaway sales in the December quarter were helped by Christmas, when phones are often given as gifts, and by the huge success of prepaid offers.

Neither Vodafone nor Telecom disclosed figures for new prepaid additions, although previous Telecom figures indicated an 87,700 rise in new prepaid subscribers in the September quarter.

While Telecom's subscriber base now numbers an impressive 858,000, the December quarter was the first time that Vodafone has managed to take a larger share of new subscribers than Telecom.

Vodafone's 104,000 additions is also impressive when compared with its Australian parent, whose 142,000 new subscribers in the December quarter was well below analysts' expectations.

Attractive prepaid deals in Europe have gone a long way to pushing mobile penetration in Britain to more than 50 per cent, and in some Scandinavian countries to 100 per cent.

Prepaid presents a challenge to mobile operators because revenues from new customers are lower than from post-paid, in part because of the free minutes offered to entice them to sign up.

In the September quarter, Telecom said that the surge in prepaid connections had resulted in 18 per cent lower revenue per customer than in the previous year.

The challenge of boosting revenue per customer is a driving force behind Vodafone AirTouch's plans, unveiled this week, to offer a mobile global internet portal from July.

Meanwhile, 13 international telephone companies have lined up in Britain to bid for five high-tech, new generation licences for mobile phones being auctioned by the British Government.

Reuters reported bids were lodged by the country's four established cellphone groups - Vodafone AirTouch, BT Cellnet, Orange and One2One - together with nine rivals from Europe, the United States, Japan and Australia.

Contenders include aggressive US carrier MCI Worldcom, a consortium led by Richard Branson's Virgin Group, and One.Tel Global Wireless of Australia.

Securing a so-called UMTS (Universal Mobile Telecommunications System) licence would allow mobile companies to offer services such as high-speed internet access, e-mail and the capacity to download music and pictures.

A similar auction is being held in Spain as Europe gears up for a host of high-speed services that will turn mobiles into high-performance micro computers.