Mobile phone service provider BT Cellnet yesterday recorded its first drop in mobile phone customers for 16 years, thanks to its new 'benchmark' accounting standards.

After speculation over the accuracy of previous figures, BT Cellnet has adopted a system similar to that of competitor Orange to calculate its quarterly accounts. The accounting scheme disregards customers whose phones have not been active in the last three months.

"The adjustment in our figures confirms our active customer base, and as a result we are well placed to grow profitably in a market where the pace of overall customer growth is slowing," said Peter Erskine chief executive officer of BT Wireless.

The new figures mean BT Cellnet has now slid into third position behind Orange and Vodafone, which has promised it too will adopt the scheme for its future accounting practices.

But despite industry encouragement towards subscription-based handsets, out of Cellnet's 10.9m customers 7.5m use prepay services.

"People are still opting for prepay services for convenience," said a spokesman at BT Cellnet. "It still remains an excellent way for parents to monitor their children's phone use and for people who do not want to make regular payments to still have a mobile phone. But with the introduction of 3G more people will want to switch to take advantage of 3G's services."