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Virgin Mobile hits five million UK users

But churn is up and ARPU down

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Virgin Mobile has five million UK users - a 37 per cent increase on the same period a year ago. But the virtual mobile operator is suffering from an increasing level of churn and lower Average revenue per user (ARPU).

Virgin had its best quarter for new connections in Q4 04 - 417,000 new customers signed up, giving a total of 5,026,000 customers, up 37 per cent on the same period last year. At 31 December 2004 "the 90-day activity level was 77.2 per cent." Churn also increased to 16.2 per cent from 13.8 per cent at the end of December 2003.

Tom Alexander, chief executive at Virgin Mobile, said the company's performance demonstrates "once again the strong consumer appeal of our brand, as well as the robustness of our virtual business model". Virgin hires network capacity from T-Mobile.

Revenue for the third quarter was up 9.4 per cent. But ARPU continued to fall from £137 last quarter to £132 now. ARPU peaked 31 March 2004 at £147. Virgin blamed Ofcom's reduction in interconnect rates for the fall.

Press release here. ®

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