The next generation mobile phone operator, 3, has reportedly managed to reduce its losses in the U.K., a great update on how they are correcting the management flaws after initially launching 6 years ago. Pre-tax losses in the year to December 2008 narrowed from £1.4 billion five years ago to £152 million, and down from £791 million a year ago. Revenues at the group, owned by Hutchison Whampoa of Hong Kong, jumped 18 per cent to £1.5 billion.

3, which has 8 per cent of the British market, with 4.9 million customers, has faced problems since it launched in 2003. A strategy based on securing high-spending customers through gimmicks such as video-calling flopped and the group was forced to lure customers with cheap tariffs.

In the early days, 3G technology, which was supposed to transform mobile phones into mini-computers, was fraught with pitfalls. The group also spent heavily acquiring new customers in competition with giants such as Vodafone and O2 — contributing to its record £1.4 billion loss in 2004. Analysts said that the group had benefited from the appointment of Kevin Russell as chief executive, with his focus on providing cheap voice and data calls.

3 has also succeeded with innovative tie-ups such as its alliance with Skype, the internet voice caller, which enables customers to make free calls on their mobile phones. The group is also the market leader for datacards.

(Source) Times Online