Mobile broadband is proving a cash cow for UK internet service providers (ISP’s), new figures have shown, which further highlight the millions of pounds of potential revenue being lost by companies who have yet to launch a mobile broadband service.
O2, which has led the mobile broadband revolution with designer dongles and free laptops, has recorded profits of £6.26 million - representing a ten per cent year-on-year rise. The company has attributed the improvement to booming demand for mobile broadband as well as healthy sales of the 3G iPhone.
Meanwhile, T-Mobile has confirmed that its mobile broadband sales have increased by 250 per cent. This coincided with a statement issued by Jim Hyde of T-Mobile which testified to the impact that mobile broadband and the G-1 handset has had on limiting the company’s losses over the last year. His comments follow an announcement from T-Mobile in January that it has earmarked £115 million of investment marketing its services in 2009, with a sizeable proportion of this expected to be used to publicise mobile broadband.
The release of the figures comes after studies of the broadband market conducted by Top 10 Broadband revealed the competitive advantage being enjoyed by those who offer mobile broadband. The site calculated that Sky and TalkTalk are missing out on £36 million of potential revenue every month as a result of their failure to react to the surge in demand for mobile broadband services.
Responding to the findings at the time, Jessica McArdle, marketing manager of the site, forecast that unless both companies act soon their failure to launch a mobile broadband deal would represent “commercial suicide”. Now, faced with the latest figures from O2 and T-Mobile, Ms McArdle said that they are further evidence of the potential harm that Sky and TalkTalk are doing to their position among UK broadband providers.
News today that T-Mobile planning to upgrade its mobile broadband network so that it is capable of delivering connection speeds of up to 14.4Mb could leave Sky and TalkTalk in danger of falling further behind. Meanwhile, Vodafone has successfully tested mobile broadband technology that is capable of reaching speeds of up to 20Mb.
In January mobile broadband sales through Top 10 Broadband exceeded those of home broadband for the first time ever. By way of comparison, in January 2008 mobile broadband accounted for just ten per cent of sales.