Digifone dropped the rates it charges for mobile calls yesterday, saying it was positioning itself for yet another surge in usage across the Republic. The company said it was gaining market share on its rival, Eircell, and promised calls as low as 2p (2.5 cents) a minute at weekends.
Digifone, which is owned jointly by Esat Telecom and Norway's Telenor, said it now had 460,000 subscribers, split evenly between pre-paid "Speakeasy" customers, and those on contracts. The company's chief executive, Mr Barry Maloney, said the company controlled 41 per cent of the total mobile market; excluding the older analogue service, which Digifone does not provide, he said Digifone had a market share of 49 per cent.
Mr Maloney said there were now 1.1 million mobile subscribers in the Republic, representing a penetration level just above the EU average, at around 30 per cent of the population. He predicted penetration could reach 40 or even 50 per cent by the end of 2000, suggesting that the number of mobile subscribers would outstrip that of fixed-line customers.
"We believe it is going to take place in Ireland before other countries," he added. "Today's announcement is designed to accelerate the switch to mobile for voice calls."
Digifone said its new tariff structure offered packages on average 15 per cent lower than those of Eircell. Marketed as "Select 1, 2 and 3", the packages also offer options, including one which reduces call charges to land lines and other Digifone customers to 2p per minute.
Mr Maloney said Irish people "love to talk", and mobile customers spend on average 25 per cent longer on each call than most other European countries. He said reducing the call prices at weekends would suit many users.
He would not comment on speculation that Digifone would make an attractive takeover target for Europe's larger mobile operators, but said that benchmarked against the per-customer valuation of Deutsche Telekom's acquisition of One-to-One, the Irish provider would be worth over £1.2 billion (€1.5 billion).
Using as a basis the £19.8 billion sterling (€30.7 billion) plus £2 billion of debt that Germany's Mannesmann said yesterday it would pay for Orange, analysts said Digifone could now be worth £1.5 billion.
