Smartphones lift Vodafone Ireland

Smartphones have surged in popularity at mobile operator Vodafone Ireland, with more than 530,000 now being used on the network.

In an interim management statement today, the network said higher data usage boosted its average revenue per user in the quarter ended June 30th compared with the preceeding three month period, gaining 1.9 per cent.

Vodafone has sought to drive data sales from smartphones including Apple's iPhone and handsets running Google's Android software to counter declining European service revenue.

However, ARPU is still 6.3 per cent lower compared to the same period last year.

During the quarter, voice calls and text messages were both higher compared to a year earlier, with the latter rising by 15 per cent and calls increasing by 4.9 per cent year on year. A total of 224 message were sent per customer, higher than the European average of 109. In total 1.49 million texts were sent by Vodafone Ireland customers in the quarter.

The company added a net 7,900 customers to its broadband business during the quarter, bringing the total subscriber base to 366,600 at the end of the quarter.

The wider Vodafone group reported slowing service revenue growth for the fiscal first-quarter because of a decline in southern European markets and a cut in UK mobile-phone fees.

Service revenue, which includes voice, data, messaging and broadband services, rose 1.5 per cent when currency swings and acquisitions in the three months through June were excluded, after rising 2.5 per cent in the prior quarter. Analysts had estimated growth of 1.4 per cent.

"We have made a good start to the year, reporting robust results despite challenging macroeconomic conditions across southern European economies and the impact of cuts to mobile termination rates," chief executive Vittorio Colao said today in the statement. The company reiterated its full-year forecast.

In Spain, where the company recently replaced its top manager, Vodafone is struggling to boost sales amid the highest unemployment rate in Europe.

Total sales rose 3.5 per cent to £11.7 billion in the fiscal first quarter. Under Mr Colao, annual sales from mobile data have climbed to more than £5.1 billion since he took control of the company in 2008.

The British operator has said it plans to increase the percentage of sales from smartphones in
Europe to about 70 per cent in the fiscal year ending March 2013 from 30 per cent last year. The company is switching to tiered pricing plans based on the amount of data used and quality of service.

Additional reporting: Bloomberg