Subscribers And Losses Rise At Freeserve

Freeserve, the UK’s largest internet service provider (ISP), has announced a strong increase in subscriber numbers, alongside deepening losses over the last quarter. In the 16 weeks to 21 August the free ISP saw subscribers increase by 19% quarter on quarter to 1.4 million.

The rate of growth in Freeserve’s subscribers increased by 19% over the period, with the total number of customers reaching 1.5 million. The company said that it is adding customers at the rate of 14,000 per week, although churn is around 9.5%, down slightly on the previous period. However, each of these customers is costing Freeserve as total pre-tax loss came in at £8.6 million.

The service, which was launched by Dixons in September last year (see Dixons Launches Free Internet Service), plans to move into profit through the sale of advertisements and a cut of e-commerce transactions. Dixons floated 18.25% of Freeserve in June, valuing the company at around £1.5 billion (see Float Values Freeserve At Up To £1.5bn). However, shares have since fallen as investor and analyst confidence in internet service companies has wavered as the sector becomes more crowded (see Freeserve Shares Fall Below Flotation Price).

Freeserve: 01442 354 285 … http://www.freeserve.co.uk/