Europe : Hutchison Whampoa has announced its results for 2004. In some respects they follow a typical pattern: asset management and a revaluation of properties resulted in one-off gains that boosted profits by 38.1%, offsetting further losses in 3G.

However, the company stuck to its target of reaching EBITDA break-even in 3G this year, and continued to discuss the possibility of floating 3 Italy. Comment: Overall, the group's 3G operations posted a net loss of HK$25.32 billion, higher than expected, Hutchison claims, because of new accounting standards. The loss before interest and taxes widened to HK$37.5 billion, from HK$11.88 billion in 2003.

On the subscriber side, things were rosier. In 2004 the company finally hit the sweet spot of growth it was aiming for in the previous year: 3 UK began the year with 200,000 subscribers, and ended March 2005 with over 3m. 3 Italy recorded 3.56m.

While much of this growth was gained via aggressive handset and tariff subsidy, if 3 can keep its customers they are likely to prove valuable. This has been successful in attracting heavy users away from rival operators: 3 UK's ARPU is still an industry high at £40 per user. Interestingly, data revenues amount to 20% of the total (still less than industry peers), suggesting that for 3, voice is the real winner.

As we've pointed out before, there are considerable ironies in the operator that wanted to throw out the 'tired, stale' 2G business model finding the most success in selling voice services.

About:
This article is an extract taken from Ovum's EuroView Daily Comment service. Providing our expert's views and opinion of the important news and events in European IT & Telecoms, this daily email bulletin is a component of Ovum's EuroView advisory service.