moneysupermarket.com: Carphone Warehouse results

Commenting on Carphone Warehouse results, Jason Lloyd, head of broadband at moneysupermarket.com, said: "These latest results from Carphone Warehouse are strong and ahead of market expectations.

"Perhaps the most significant item is that Carphone Warehouse announced its intention to reduce the monthly line rental fee for voice only customers and offer free calls to landlines in 30 international countries. In effect, BT was the cheapest provider for less than a week before Carphone Warehouse trumped it on value. This price cut doesn't apply to broadband customers, who will now pay more on line rental than voice only customers, but at least they get the free international landline calls.

"The results show that Talk Talk has 700,000 customers on its own unbundled network, from a total of 2.27 million broadband customers (including AOL). This suggests that the majority of its AOL customers are still on the BT wholesale network and that the migration to LLU is probably its focus for 2007. My worry here however is that since its LLU covers 1,100 telephone exchanges from 5,000 in the UK (admittedly its network covers 65 per cent of the residential population) it's not really going to do anything for AOL customers living in rural areas outside of Talk Talk's urban LLU network.

"Carphone Warehouse has admitted that the process of migrating customers from BT wholesale network to LLU has presented huge problems from a customer service perspective. It seems likely that this will be bad news for AOL customers living in urban areas who will experience issues as the transfer takes place. However, rural AOL customers will not see their service too badly affected, which will finally be some good news for rural broadband customers, although they are likely to remain on the BT network. Added to this, new rural AOL customers will have to pay £10 a month more than their urban cousins. I guess you have to ask yourself do Talk Talk / AOL actually want rural customers that are not connected to their LLU network?"

"I welcome Talk Talk’s announcement of an increased spend of £10-15 million in 2007, which is devoted to costs associated with an increase in customer service staff and infrastructure. I am hopeful that this is the first of many broadband providers to actively show a commitment to delivering better customer service to its users by bringing in more resources to handle customers more effectively."