Mobile operator O2 Ireland added 20,900 new contract customers in the three months to September 30th last and now has a total of 1.632 million subscribers.

Service revenues at O2 grew 6.8 per cent year-on-year to €243 million. However, average revenue per user (Arpu) per month, a key metric for telecoms operators, rose only fractionally across all customer segments to €47, compared to €46.70 in the previous quarter and €45.20 a year ago. The average number of minutes used by customers grew by 3.6 per cent year-on-year to 250.

And the average monthly revenue from prepay customers, which account for about 70 per cent of O2 subscriptions fell - dipping to €29.20, compared to €30 in the previous quarter and €29.80 a year ago.

The average monthly spend by contract customers was up 1.3 per cent quarter on quarter to €84.90.

Paul Whelan, O2 Ireland's chief financial officer, said the prepay market was now the most competitive he had ever seen with five operators in that space following last month's launch of Tesco Mobile, which runs on the O2 network.

As a result, Mr Whelan said customers were getting "fantastic value".

Data revenue as a percentage of overall service revenue was 26.4 per cent up from 23.3 per cent in the same period last year.

"Uptake of our broadband product to date has been robust, exceeding our expectations," said Mr Whelan.

He also said the company's base of users of the Blackberry e-mail device was its highest ever.

He conceded, however, that SMS text messaging continues to account for the largest component of data revenues. A total of 393 million text messages were sent during the third quarter, a 1 per cent decrease on last year.

O2 Ireland's parent Telefónica yesterday reported a major surge in third-quarter profits, with net income rising to €4.02 billion on revenues of €14.19 billion, compared to profits of €2.9 billion on revenues of €13.54 billion in the year-ago period.