Talk Talk success creates 'nightmare'

Thursday, July 27, 2006 - 09:11 AM

Carphone Warehouse said today that it had signed up 476,000 to its “free” broadband product Talk Talk and admitted its customer-service provision had not kept up with demand.

The huge interest in the service helped Europe’s largest mobile phone retailer lift group revenues by 42% to £857.6m (€1.3bn) while retail revenues rose almost 30% to £394.3m (€575.6m) in the 13 weeks to July 13.

Total connections were up 35% to 1.96 million in the first quarter while subscription connections rose 18% to 860,000.

Chief executive Charles Dunstone admitted at the weekend that the free service created a customer-service “nightmare” for the firm.

In the first eight weeks it signed up 340,000 customers, almost double the number it anticipated when the service launched in April. Many customers had to wait months to get connected.

Mr Dunstone said he was taking personal responsibility to ensure it could meet its customer-service targets.

“We have explored our customer-service capacity substantially since June to meet this additional demand and this is now having a noticeable effect,” he said today.

Of those who have subscribed, some 402,000 are live for calls and line rental, while 247,000, just over half, are live on broadband as well.

Writing in his blog on the Carphone Warehouse website, Mr Dunstone said on Friday: “We are making good progress on provisioning broadband and if you sign up now we are still quoting a go-live before the end of September.”

He added: “Queues into the call centres have reduced again and while I am still not at all happy that there are any delays at all, I can really see that the problem will be removed within the next five to six weeks.”

When Carphone launched the offer, which costs £21 (€30.70) a month through subscription to Talk Talk, bundling broadband with UK and international calls to 28 countries, only 150,000 of its 2.6 million customers used broadband. It now has 596,000 broadband customers in total.