People aren't using mobile phones for voice calls anymore
EE's third quarter results on Wednesday show revenues from voice and minutes are collapsing. The average revenue per customer coming from calls fell by a huge 10.3%.The number of minutes customers used per month fell 4.4% to 194, while the average number of minutes used by customers on contracts collapsed 8.6% from 313 to 286.Advertisement
EE is Britain's biggest network, so these figures are pretty representative.
CFO Neal Milsom told Business Insider: "Over time, yes, traditional revenue streams are declining. SMS is declining, it's being replaced by data, emails, WhatsApp and stuff."And overtime voice is declining as well because again people are using alternative ways [to communicate] be it Facebook or whatever. At the end of the day, customers want to use the means that they want to - voice, text, data, whatever."
This isn't bad news for networks like EE, though. While people are making fewer calls and become less willing to pay for minutes, they're becoming more and more reliant on data.Milsom says: "What we're seeing is a massive growth in data. The average usage for our consumer contract customers has increased by 50% year over year. If they've got a smartphone in their hands they use a lot more data and to some degree it is replacing voice and texting."EE launching a product at the start of the year that lets people make calls over wifi networks, similar to Skype. 1.7 million have made 125 million calls using the product since then.Advertisement
Milsom also says it's wrong to say the age of mobile calls is over. He says: "All three products have a place going forward - voice, data, SMS. I think it's too early to say the call is dead."
EE's CEO Olaf Swantee added: "All our growth will come from data. But what is interesting when we talk to business customers, we win a lot of customers from competitors on the back of a bad voice experience."A lot of employees complain I can't make a phone call or the phone call drops. Still voice plays a very important role in winning new businesses."Advertisement
In part because of the decline of voice, EE is looking for growth from business customers and catering to new trends like internet connected machines.
EE's third quarter turnover fell 0.3% compared to the same quarter last year to £1.58 billion ($2.4 billion). The company is currently being bought by BT and Swantee says he expects the Competition and Markets Authority to deliver its preliminary verdict on the deal either this week or next.
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