The joint venture between British mobile operators Orange UK and T-Mobile UK, Everything Everywhere (EE), has outlined its strategy for growth, while also detailing the progress it has made on the integration of the two units and its performance in the three months to end-June 2010.
Having received regulatory approval for the tie-up in March 2010, EE has said that it is continuing to make ‘excellent progress’ with senior management in place at both the vice president and director level. Further, it reiterated that it expected the first major benefit of the tie-up to be introduced in October, with the first phase of its ‘super network’. As previously reported by CommsUpdate earlier this month, from 5 October 2010 all Orange and T-Mobile subscribers will be able to make calls and send SMS messages over either network at no additional cost to their standard tariffs; customers will be required to register specifically for access to both networks. EE has said that its strategy is based on three principles: a lean and agile backbone, including a highly efficient cost structure and what it claims is the biggest 2G and 3G network in the UK; sustained commercial leadership, with a focus on growing its retail footprint and expanding direct channels; and building a platform for growth by developing new revenues from GBP1.4 billion (USD2.2 billion) to GBP1.9 billion in 2014 in the B2B, fixed broadband and wholesale sectors. EE also confirmed that it expects to meet its planned merger synergy target of more than GBP3.5 billion, with its updated plan including increasing the number of network sites from around 16,000 to more than 18,000.
In terms of its financial performance, for the three months ended 30 June 2010 EE said that mobile service revenue stood at GBP1.56 billion, while earnings before interest, tax, depreciation and amortisation (EBITDA) was GBP309 million; it said that both turnover and EBITDA in the quarter had been affected by the introduction of lower regulatory caps on mobile termination rates.
Commenting on the current status of the joint venture, Tom Alexander, EE’s chief executive officer, said: ‘Everything Everywhere has made rapid progress in the six months since incorporation, with a strong leadership team in place and a clear strategy based on transforming the market through network leadership. We have identified in excess of GBP3.5 billion of synergies, allowing us to further invest in our networks and building our customer offer for both today and tomorrow. Our aspiration is to give people instant access to everything everywhere and with the launch of national roaming next week – enabling our customers to access what matters to them over two national networks – we are well on our way.’