Following reports earlier this week that Blyk is looking to expand its European ad-funded MVNO business model to Asia, the company has announced that it has raised an additional €40 million (US$51 million) to support its ongoing operations and planned expansion outside the UK. However, the company’s CEO and co-founder, Pekka Ala-Pietilä, added that the economic crisis has forced it to cut costs and “streamline” its organisation – which is being read by industry observers as job cuts. The company has also announced a new marketing strategy based upon partnering with major operators and local media companies, as against operating as a vanilla MVNO.

“We don’t need to work purely on our own,” said Ala-Pietilä. He added that this new approach had been triggered by growing interest from Europe and Asia, which had prompted the company to reconsider its expansion plans and be more flexible in pursuing new opportunities. While Blyk has led a seemingly charmed life – gaining over 200,000 UK users to its ‘free’ mobile phone service in 12 months – these cutbacks look to be the result of the sharp downturn in advertising.