London-based telephone and online directory company Scoot.com has for the first time in its chequered history introduced charges to callers for accessing its services. The move, Scoot predicts, will lose it over half the 350,000 customers who daily call to locate electricians, car rental companies and other amenities.
Charging for telephone inquiries at an eye-watering 50p a minute is central to the success of Project Genesis, a plan devised by Scoot’s former chief executive and second largest shareholder Robert Bonnier before his departure in June. This aims to move the company out of the red for the first time since its launch some years ago. Admits managing director Terry Martin: “We expect to lose about 65 per cent of calls initially but then for it to grow back.”
Martin also unveiled pre-tax losses surging to £174.8 million for the nine months to September – a dramatic year-on-year increase from £34.2m last time, despite cost savings of £2m in the third quarter.
Scoot managed to survive a cash crisis by the skin of its teeth in August when it sold its profitable advertising newspaper Loot for £45m to the Daily Mail & General Trust – having in 2000 paid £178 million in cash for the same property.
Martin said that Scoot’s strategic review continues while it is “talking to potential partners”.
News source: The Times (London)