O3 Declares Insolvency
O3, the KUJ’s national carrier, has officially declared bankruptcy, according to insolvency documents released by His Majesty’s Revenue & Customs. The document reveals many interesting details, namely that thecarrier had $500,000,000 of unresolved debt as a result of phone contracts. A combination of grave pricing errors and the high popularity of said contracts has resulted in O3 spending hundreds of millions of dollars on devices and never making a profit on said devices.
For example, an iPhone 16 + iPad Pro deal costs $39.99 (erroneously reported as $9.99 in an ad) for 24 months. That amounts to $959.76 after two years, plus whatever fees they collect from pay-as-you-go calls and texts.
This sounds like a decent amount of money, however, an iPad Pro retails for $899 and an iPhone 16 for $799, meaning O3 loses $738.24 in total. Given their calls costs $0.01 each, you’d have to send at least 73,825 texts for them to break even on the hardware costs alone. That’s over 100 texts per day on average, or well over a dollar spent on PAYG daily, which is simply unrealistic for most customers.
As such, insolvency was not surprising. That said, the future of O3 is uncertain, though it is clear the government will not allow the company to shut down or fall into the hands of a foreign company. Until then, exactly how it plays out depends on who tries to buy the company and absorb its debt.