Hutchison Phones To Roam On Next G

Sydney Morning Herald

Wednesday August 20, 2008

Matt O'Sullivan

HUTCHISON has narrowed its first-half loss to $85 million and scored an unexpected bonus in persuading Telstra to let its mobile-phone customers roam outside the cities on its Next G network.

A perennial bleeder of red ink - and the plaything of the Hong Kong billionaire Li Ka-shing - Hutchison reduced its loss from $197 million in the same period last year as it increased mobile customers by 29 per cent to 1.81 million.

Revenue at Australia's fourth-biggest mobile carrier rose almost 24 per cent to $761 million.

Telstra has been very protective of its third-generation Next G network since it was launched ahead of schedule in October 2006. The latest deal will allow Hutchison's mobile customers to roam on Telstra's 850 megahertz network in regional and rural areas.

Hutchison's chief executive, Nigel Dews, said the deal would lead to lower roaming costs for customers, although the company was still in the process of detailing the prices.

Mr Dews would not reveal whether customers would get the same wireless broadband speeds roaming on Telstra's network as the incumbent's subscribers. But Telstra was quick to emphasise that only its customers would gain speed of 14.5 megabits per second.

Hutchison's customers in cities will stay on the 2100 megahertz network it shares with Telstra.

The deal will expand Hutchison's coverage to 96 per cent of the population whereas Telstra's goes to 99 per cent. The service will begin in the second quarter of next year.

Hutchison missed out on selling the iPhone in Australia in July to its three other mobile competitors - Telstra, Optus and Vodafone.

Mr Dews said the release of the iPhone had not affected Hutchison's top-line growth, although he did admit it had caused a small increase in customer churn.

Despite years of losses, Mr Dews declined to comment on when the company, whose main brand is "3", will post a profit, saying it was taking one step at a time. Hutchison intends for its earnings before interest and tax to break into the black by the end of the year. Shares in Hutchison fell 2c to 11c yesterday.

© 2008 Sydney Morning Herald

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