Virgin Media has connected 335,000 mobile subscribers to its 5G service in just three months as the company recorded its best quarterly increase in revenue for more than two years during the first quarter of 2021.
The 5G service went live on January 25, and Virgin Media isn’t charging customers a premium to access 5G across a range of pay-monthly and SIM-Only plans. This means anyone with a compatible handset can access the fastest speeds available.
One of the reasons Virgin Media replaced EE with Vodafone as its Mobile Virtual Network Operator (MVNO) partner back in 2019 was so it could launch 5G as soon as possible. While EE launched 4G in late 2012, it wasn’t until November 2016 that Virgin Media customers could get access to the latest speeds.
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Virgin Media 5G
The launch of 5G and continued investment in its fixed network is having a direct impact on subscriptions. In terms of new customers, Virgin Media attracted 52,000 new mobile customers – a record for Q1 – while its broadband base increased by 43,000, a 310% increase year-on-year. Moe than a quarter of all broadband customers also have a mobile contract, aiding Virgin’s convergence strategy.
This demand has partly been driven by the need for more reliable, faster connectivity during the pandemic. Data consumption is up by 40% and nearly all customers take packages of 100Mbps or faster.
Virgin Media’s network is now available 15.4 million households, more than half of the country, with gigabit speeds now reaching 46% of those. Virgin Media is on track to cover its entire footprint by the end of the year.
Combined with increased demand for home office and business connectivity due to the pandemic, revenues increased by 1.4% to £1.27 billion. However profitability was down by 1.9% to £507 million due to other costs.
“We’ve hit the ground running this year, sustaining the momentum we saw in 2020 and delivering a rock-solid performance,” said Lutz Schüler, Virgin Media CEO.
“The demand for our services has never been clearer. Continued investment and innovation resulted in our strongest first quarter customer additions since 2017, record-low Q1 cable churn, an acceleration in converged bundle growth and a 300% boost in new broadband subscribers.
“A surge in mobile handset sales, coupled with strong top-line growth in B2B, drove our best overall revenue increase in nine quarters. This is combined with sustained investment in gigabit network expansion, digital transformation and customer service – all of which are instrumental components in establishing a stronger and nimbler business for the future.”
Virgin Media hopes to merge with O2 later this year, after UK competition authorities found no reason to block the proposed £31 billion deal.
The combination of O2’s mobile infrastructure and Virgin Media’s cable network would immediately create one of Europe’s largest telecoms organisations, powering communications for nearly 40 million subscribers. Consolidation would also result in £6.2 billion in savings and provide the scale and capability to rival BT and Vodafone in the field of converged networking services.
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