One 2 One has had to abandon its corporate strategy of increasing its market share by the sale of phones regardless of financial consequences. The heavy subsidies, which have become a mark of mobile operators, are no longer economically sustainable for the company. The firm currently pays between £70-£80 for each handset from firms such as Nokia.
This move is a consequence of the enormous debt costs created by the purchase of third-generation licenses.
Since 1997 mobile operators have been heavily subsidizing pre-pay products, creating a widespread underestimation of their value, Mr Jones said. This is particularly the case with the latest generation of phones. I do not believe this is a sustainable situation.
