Highly competitive UK mobile market puts pressure on “3”
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Published:
Week 35
September 2006 -
Image Source:
3
News:
Announcing its latest results, Hutchison Whampoa revealed that it has abandoned its target of EBITDA (earnings before interest, tax, depreciation and amortisation) breakeven by the end of 2006 for its “3” network in the UK. The company cited a tougher than expected market in this territory.
The results indicated that the company is suffering from very high levels of churn calculated at an annualised rate of 43 percent in July 2006.
In a move indicative of attempts to slow losses, subscriber acquisition costs have slowed to just 4 percent in the first half of 2006. This supports reports from the UK High Street suggesting that while 3 remains competitive with its propositions and has expanded its product portfolio to gain some traction, the end-users are seeing better value elsewhere.
