iD Mobile has added 115,000 new customers in the first half of 2017 to take its total active users up to 715,000.
Financial results from the SIM Only brand’s owner – Carphone Warehouse – show their SIM Only numbers are still increasing despite the drop in sales on contract phones.
In August Carphone Warehouse were forced to issue a profit warning when shopping trends saw far
fewer people buying the latest smartphones.
And despite tough conditions at the value end of the market, iD Mobile’s SIM Only business continues to grow, fuelled by bargain-hunters and those looking to shave costs from their monthly outgoings.
Who are iD Mobile?
Formed in London in 2012, iD Mobile offer low-cost SIM Only deals on 30-day rolling contracts for maximum flexbility.
It runs on the O2 network for voice calls and data.
This summer it launched one of the UK’s cheapest deals at £3.49 a month for 500MB data, 500 minutes and 5,000 texts.
The business launched its leasing proposition in stores during the first half and rolled out new SIMO journeys.
iD in the UK continues to benefit from its differentiated proposition with the number of active customers increasing to 715,000 from 600,000 at the end of the last financial year.
The changing market landscape will require us to use our expertise and scale to work even closer with our existing partners, broaden our range of product offerings whilst continuing to drive value for our customers.- Seb James: Group Chief Executive, Carphone Warehouse
What does this mean?
If profits are so hard to come by selling cheap SIMs, we may see a new position in the market growing up where providers focus on upgrading SIM Only users more data for long-term value.
Prices of these cheapest deals may go up, or we might see Carphone Warehouse offload iD Mobile in the same way as TalkTalk is looking to do with its Mobile division.
Cannier consumers = better bargains
“Handsets have become more expensive whilst technical innovation has been more incremental,” remarked Seb James this summer.
Mobile companies bet strongly on the £999 iPhone X overturning weak profits. Too strongly.
Repeated delays in stock and several reports of technological limitations, such as the insecure Face ID, or the £286 cost to replace glass screens, dimmed consumer confidence.
And if SIM Only numbers continue to rise as predicted, they’ll soon overtake flagship phones with their eye-watering contract costs.
This will be a market of better-educated consumers and those with a cautious appreciation for costs.
So while profits will still be hard to come by, it’s the value that only SIM Only can give that will drive company priorities in the future.