MmO2 makes £10bn loss and writes down 3G licence costs

Mobile phone operator mmO2 has written down £5.9bn from the value of the 3G licences it bought three years ago and recorded a...

Mobile phone operator mmO2 has written down £5.9bn from the value of the 3G licences it bought three years ago and recorded a loss of £10.2bn  for the financial year to March.

Chief executive officer Peter Erskine insisted that the cut in the valuation of its 3G licences was not a sign that the company was abandoning 3G services. Some 40% of the value of the company's assets are still in 3G networks and licences. "So nobody is saying we don't think it's worth anything," he declared.

Mm02 learned a great deal about 3G from a trial of services conducted on the Isle of Man, Erskine said.

"Customers do like the service, but they don't like the bulky first-generation handsets," he said.

Erskine predicted that 3G services will start to become relevant in 2005. "The trial taught us not to rush out this year and launch it," he said.

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