Tuesday, August 30, 2005

Midas Touchtone

According to the FT, it seems like Eircom is about to flog €423m worth of shares in order to raise funds for the purchase of the Meteor mobile phone network (this was already mentioned over on Planet Potato). Given Eircom's reputation for shoddy service (again, see half the posts on Planet Potato. this one is my favourite!), I'm sure Meteor customers will be overjoyed!

One interesting point that the FT notes is that 'Although the offer is in line with prices paid for other recent mobile assets in terms of price per subscriber, Meteor predominantly has a pre-pay customer base of people who spend much less than contract customers.' I didn't know that pay as you go customers paid less than people on contracts. Moreover, I thought people tended to shift to contracts. Would they be just better off on PAYG, or is it the case that PAYG users simply use their mobiles less than contract users do? Also, I wonder why Meteor customers are out of line with the industry standard on this? And finally, what's possessing Eircom to pay over the odds for Meteor?

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