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Interim results from Plusnet
Tuesday 01 August 2006 13:14:00 by Andrew Ferguson

Plusnet now has 198,000 customers (including those from Metronet), which is an increase of 75% compared to its 2005 results. It has also seen its profits rise by 41% to £3.1m, on a turnover of £22.5m. The companies interim results can be read in full at Reuters.co.uk. A presentation to the companies investors can be found on the Plusnet website.

In the six months to June 2006, the company grew its userbase from 176,000 to 198,000 which is a slow down in growth compared to the previous six months, and this is recognised in Lee Strafford's Operational Review "Our broadband customer base grew from 176,000 to 198,000 in the six months to 30 June 2006, in line with the first half of 2005. Nevertheless, management is disappointed with this growth rate, which was adversely affected principally by the problematic roll-out of 8Mb services by BT and slowed between the first and second quarters of 2006. This trend mirrors a marked decline in the number of new DSL connections across the whole market from Q1 to Q2 disclosed by BT, which is symptomatic of a seasonally weak period and consumers reacting negatively to disruption in the market. BT has now addressed the systems and process problems encountered and we anticipate completing the roll-out of 8Mb in the second half of the year.".

Our recent survey on problems with the Max product suggests that many have encountered problems, but at this time Plusnet is currently the only provider we are aware of, who has put regrades on hold until August, after already regrading a proportion of its userbase. Consumers of the service, have reported on our forums and other Plusnet forums, that they are having difficulty navigating and using the new telephone support systems, which in turn may be leading to frustration, making it harder to resolve what otherwise may be simple issues. Plusnet does lay great faith in its unique operating model, that avoids multiple interfaces for customers and tries to embed them all in a single point of access via the portal. The problems of intermittent connections caused by rate adaptive ADSL, be this a BT Wholesale Max product, or a LLU based ADSL service, can make accessing an online portal more difficult, unless you are lucky and have Internet access at your place of work.

In terms of the Max regrades, we believe the UK has around 750,000 people using an up to 8Mbps connection from BT Wholesale, and generally things are now settling down. This is down to a combination of factors, such as changes to the backroom systems by BT Wholesale, better understanding of the product in providers, and much more information and help available from other users of the service.

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