O2 Germany Subscribers Top 4 Million; Fastest Growing German Mobile Operator Over Recent Months.

Business/Technology Editors

NEW YORK--(BUSINESS WIRE)--May 29, 2002

mmO2 plc, a leading provider of mobile communications services in Europe, today announced that the subscriber base of its German business now exceeds four million, over half of which are post-pay contract customers.

This follows strong subscriber growth - particularly amongst high value business customers - in the last two quarters of financial year 2001/02 and means that O2 Germany has increased its market share from 6 to 7 percent over the past year.

In recent months, O2 has been the fastest growing mobile operator in Germany. Much of this success is attributable to the increasing uptake of its O2 Genion service. Unique in the German market, O2 Genion is built around the location-based "Homezone" concept that allows mobile customers to pay fixed network rates for calls initiated from their "home" area. Most new contract customers now elect to take this innovative service which has attracted approximately one million subscribers since its introduction in July 1999.

As the last GSM operator to enter the German market, O2 has one of the most modern and densely-built networks - enabling a user's location to be precisely identified at all times. Any calls made within a subscriber's allocated "Homezone" are charged at fixed network tariffs, whilst those made outside are subject to the appropriate mobile rate.

Peter Erskine, mmO2 chief executive officer, said: "We have clearly stated that the goal for our German business is to improve profitability and, at the same time, grow market share at a rate of 1 percent per annum. Since Rudi Groger took over as CEO of O2 Germany last autumn, we have seen very encouraging progress on both fronts through a combination of rigorous cost controls and attractive customer packages. We look forward to this trend being maintained and will continue to monitor developments closely."

mmO2

mmO2 has 100% ownership of mobile network operators in four countries - the UK, Germany, the Netherlands and Ireland - as well as a leading mobile internet portal business. All of these businesses have now been re-branded as O2. Additionally, the company has operations on the Isle of Man (Manx Telecom).

mmO2 was the first company in the world to launch and rollout a commercial GPRS (or 2.5G) network and has secured third generation mobile telephony ("3G") licences in the UK, the Netherlands, and Germany. mmO2 has also applied for a 3G licence in Ireland.

mmO2 has approximately 17.5 million customers and some 14,000 employees, with revenues for the year ended 31 March 2002 of (pound)4.276 billion. Data represented 13.4% of total service revenues in the quarter ending 31 March 2002.