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Virgin Mobile gets £366m writedown

Ouch. It looks like Virgin Media’s mobile arm has let the side down if the latest set of quarterly results is anything to go by: the company has announced a massive goodwill writedown on Virgin Mobile in its second quarter financials. In short, Virgin Mobile is now worth £366 million less than originally thought in goodwill terms.

Such writedowns are a bit of a nebulous beast – who can really guess how much people’s warm and fuzzy feelings are worth towards a brand? – but wiping £366 million off Virgin Mobile’s value, even if it is purely on paper, has got to smart a bit.

That said, it doesn’t look like this is a major blow for Virgin Mobile. The decision to go ahead with the writedown comes as a result of declining values for mobile phone companies across the board, according to Virgin Media. Virgin Mobile’s got a few other reasons to be cheerful too: the company is planning to get into the tasty 3G data market, it’s doing better selling mobile contracts to cable customers and it’s squeezing more cash from its pre-pay customers as well as adding more post-pay users. It might be a knock, but Virgin shouldn’t have any difficulty in putting it behind them.

3 replies on “Virgin Mobile gets £366m writedown”

I reckon this may also be partially down to Blyk too. I mean, a lot of teenagers, and young people are on Virgin, because it's cheap and cheerful, and it's quite good to be honest. And so maybe because people are leaving they are seeing things slip?

I know I left Virgin, and a couple of my friends did.

That though, is just an idea.

Samantha.

I reckon this may also be partially down to Blyk too. I mean, a lot of teenagers, and young people are on Virgin, because it's cheap and cheerful, and it's quite good to be honest. And so maybe because people are leaving they are seeing things slip?

I know I left Virgin, and a couple of my friends did.

That though, is just an idea.

Samantha.

I reckon this may also be partially down to Blyk too. I mean, a lot of teenagers, and young people are on Virgin, because it's cheap and cheerful, and it's quite good to be honest. And so maybe because people are leaving they are seeing things slip?

I know I left Virgin, and a couple of my friends did.

That though, is just an idea.

Samantha.

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