Three Ireland stems customer outflow sparked by price rises

Mobile operator Three Ireland has reversed the effects of an outflow of contract customers that was caused by price increases last summer, and which contributed to an 8 per cent decline in revenues for 2017.

Its financial performance for the year is contained within the annual results of its parent, Hong Kong conglomerate Hutchison Whampoa, which reported on Friday morning.

They show that revenues at Three’s Irish unit declined by €49 million to €603 million, while ebitda (earnings before interest, tax, depreciation and amortisation), a standard financial performance metric, fell 10 per cent to €169 million.

Overall group revenues across for the wider Three mobile group rose by 13 per cent in 2017.

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Hutchison Whampoa said that said the reduction in its earnings was due to a “voluntary churn”, or loss, of customers “that follows the implementation of price changes on contract customers ”.

Postpay customers

This refers to price increases for monthly postpay customers that were announced by Three Ireland just before the start of last summer.

At the time, it attributed those price rises to cuts European Union roaming charges and the fact that it hadn’t implemented price increases in its “core portfolio in a number of years”.

It is understood that the effect on its performance stabilised quickly and its earnings “improved markedly” in the second half of 2017, according to a spokesman for Three Ireland.

The active customers base for Three, the State’s second largest mobile operator, remained relatively steady at close to 2.1 million. Average monthly revenues per customer of €21.46 for pay monthly, and €15.60 for prepaid customers, were well ahead of the group’s average across Europe.

Online media services

It is understood that Three Ireland’s data volumes rose 77 per cent last year, as customers increasingly turn to content-rich online media services. About 30 terabytes, the equivalent of 1.5 billion WhatsApp messages, is transmitted on Three Ireland’s network every hour.

The results confirm that Three Ireland paid €19 million last year towards a nationwide 5G licence, and services will trial later this year.

It also invested €109 million throughout 2017 on network improvements.