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EE 'on track' after launch of 4G

Orange and T-Mobile operator EE has said it signed up more than 200,000 new contract customers at the end of last year as it became the first company to launch superfast 4G.

The group said more than half its customers were now on contracts, with most opting for smartphones, as its 4G network reached 43% of the population in 18 towns and cities, including London, Cardiff, Edinburgh and Belfast, by the end of last year.

The group said its average revenues were five times higher for each customer on a contract, but it saw revenues decline 1.9% to 6.7 billion as it suffered from the impact of regulatory cuts, including roaming charges.

EE became the only operator in the UK to offer 4G services last year, with contracts costing between 36 and 56 a month, with the service available on smartphones from makers Apple, Nokia and Samsung.

It said customers migrating to 4G services were on average spending 10% more than existing users. However, with the auction of the rest of the 4G spectrum ongoing, EE has not disclosed how many customers it has attracted to its faster network. When including one-off costs such as restructuring, EE's pre-tax losses increased by 55% to 249 million.

Chief executive Olaf Swantee said: "We have started to see EE become known for having a great network which will give us long-term benefits and advantages. The launch of 4G has been instrumental for us and we are on track with our plans around 4G."

EE, which has more than 26 million customers, kept its churn rate - or the number of customers leaving the business - at 1.2%.

Mr Swantee said that it had signed up more than 1,000 corporate customers to the 4G network, including Sony and Foxtons, but he wanted to "go after" more, with business-to-business a growing area for the company.

He said 4G customers were taking advantage of applications such as video calling, streaming, online shopping and banking on the network. EE said it would continue to "rapidly" roll out 4G, with the network expected to cover 65 towns and cities and 55% of the population by June.

The group said it had refurbished its entire retail estate and announced plans to close 78 redundant stores in 2013.

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