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Vodafone loses 120,000 subscribers in Germany

Company executives see growth opportunities in broadband business as MDU rules set to lapse.

Company executives see growth opportunities in broadband business as MDU rules set to lapse.

Vodafone logged a sizable drop in the number of German customers paying for its television service, the company reported on Monday, but executives think there are future growth opportunities in its broadband business.

On Monday, Vodafone GmbH reported its traditional pay television subscriber base stood at 12.64 million during the three-month period that ended June 30, down from 12.76 million reported in the prior financial quarter.

On a conference call with investors, Vodafone CEO Margherita Della Valle warned the losses could be higher as German regulators prepare to repeal a law that allowed multifamily dwelling units (MDUs) and other property management firms to sign exclusive contracts with telecoms to sell service to their tenants. The exclusivity agreement generally came with a provision that the telecom would lay and maintain wiring within a building.

Once the law is repealed, Germans who live in MDUs won’t be locked into buying a service from one company; instead, they will be allowed to buy phone, Internet and pay TV service from whomever they wish.

Delle Valle said the end of the rule will be something of a mixed blessing for Vodafone, as the company expects its pay TV business to shrink further. At the same time, Delle Valle said more Germans will be allowed to buy Vodafone’s land-based services if they were previously excluded. That change could see an increase in consumers taking advantage of broadband and mobile phone bundles offered by Vodafone, which in turn would improve its overal business.

Vodafone also provided an update on its UK business, where the company added 42,000 customer accounts to reach approximately 1.3 million broadband subscribers.

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About the Author:

Matthew Keys

Matthew Keys is the publisher of The Desk and reports on the business and policy matters involving the broadcast television, streaming video and radio industries. He previously worked for Thomson Reuters, Disney-ABC, Tribune Broadcasting and McNaughton Newspapers. Matthew is based in Northern California, has won numerous awards in the field of journalism, and is a member of IRE (Investigative Reporters and Editors).