3UK drives towards breakeven, but future in question

The ongoing losses reported by the UK's smallest operator, 3, have dramatically reduced to just over £150 million. While this number would normally cause an outcry from business analysts, compared to previous years' losses of £791 million and £1.4 billion five years ago it is a significant move forward, even more so given that revenues increased by 18 per cent to £1.5 billion.

However, this relative improvement in 3UK's financial performance has triggered speculation over its future. Its parent company, Hutchison Whampoa, is thought to be preparing to cut its ties with 3G mobile by selling or merging its 3 businesses. These rumours have been given fresh impetus following the recent announcement of a deal in Australia where the group has merged with the domestic operations of Vodafone and ditched its "3" branding.

However, 3UK is currently outpacing its rivals and, according to industry watchers, is growing at 11 per cent in a market that is now increasing at only 2-3 per cent. Its close relationship with Skype has caused some controversy--but has attracted the techno-savvy, and the company is the market leader for the sale of 3G data cards.

For more on this story:
Mobile Choice and The Times

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