O2 boss credits wi-fi and loyalty scheme for customer surge

Britain's second-biggest mobile network, O2, claimed to have regained the initiative in the battle of the phone giants as it won more customers than rivals EE and Vodafone in the last three months of 2012.

O2 picked up 381,000 customers, adding an extra 282,000 on contract and 99,000 on pre-pay to take the total to 22.9 million.

The fourth-quarter performance marked a major turnaround on a year earlier when O2 lost 47,000 customers and suffered its steepest revenue fall in a decade.

"This is a strong set of results which reflect the positive action we took at the beginning of 2012 to regain and build our commercial momentum," said Ronan Dunne, the company's chief executive.

He credited initiatives such as O2's growing wi-fi service, which has 5 million customers, and its loyalty programme, Priority Moments.

Mr Dunne said there was "huge interest" when O2 offered "Priority" tickets for singer Beyoncé's forthcoming "Mrs Carter" gigs in April and the company's website received over 3 million hits in two hours.

O2's results also appeared to show that arch-rival EE, owner of T-Mobile and Orange, has won no advantage by becoming the first phone network to launch super-fast 4G services last autumn.

EE admitted earlier this month that it added only 201,000 contract customers in the last quarter of 2012 despite a huge marketing campaign.