EE, the UK’s largest mobile operator, said it added another 1.4 million 4G subscribers during Q3 – taking the total up to 5.6 million – and claimed once again the crown of fastest-growing 4G operator in Europe, but it still wasn’t enough to prevent an overall drop in operating revenue.

EE blames the impact of regulation – read cuts to mobile termination rates – as one factor in explaining the 1.2 per cent fall in Q3 operating revenue, year-on-year, to £1.52 million. Total turnover fell 2.5 per cent, to £1.59 million.

But even when regulation is taken out of the equation, operating revenue for the three-month period is still not higher than Q3 2013.

Another top-line drag is EE’s dwindling prepaid base, which shrank by over 11 per cent, to 9.7 million connections. Prepaid connections may of course be much less profitable than postpaid – EE doesn’t give a margin breakdown or profit figures in its Q3 numbers – so taking some of the sting out of the prepaid loss.

The good news for EE is it continues to rack up more postpaid connections, which delivers six times higher ARPU than prepaid, although the number of postpaid net additions is smaller during this year’s Q3 than the same quarter in 2013.

Postpaid net additions (including M2M) increased by 178,000 during the quarter (compared with a 228,000 rise in Q3 2013). Over 80 per cent of new postpaid customers selected 4G, said EE, of which a third opted for double-speed 4GEE Extra. Over 60 per cent of EE’s customer base – comprising 31 million connections – is now on postpaid plans. (M2M net additions grew by 59,000, eclipsing the 47,000 increase registered in Q3 2013.)

Data revenue is also on the up. Non-voice revenue (data and messaging) grew to 59 per cent of ARPU (Q3 2013: 56 per cent), with non-messaging data reaching 49 per cent of ARPU (Q3 2013: 43 per cent).

EE said social media accounts for 30 per cent of all 4G data, driven by growth in embedded video. Facebook, YouTube, Instagram, iTunes and Twitter are the most popular apps over 4G.

The operator said it had rolled out 4G to cover over 75 per cent of the UK population, with double-speed 4G slated for 40 cities by the end of the year. EE expects to “significantly exceed” its target of 6 million 4G subscribers by the end of the year.

“We are delivering consistent underlying performance in a highly competitive environment while continuing to face significant regulatory pressure on our revenues,” said Neal Milsom, EE’s CFO. “We are investing to further innovate on behalf of our customers by delivering not just the best network but also improvements in customer service, a range of attractive EE branded devices, Shared Plans, and soon EE TV.”