O2, Britain’s biggest mobile company, has ditched its flagship mobile internet service only two years after launching it after struggling to pick up enough customers.

The 18 million customer group said today that it would not issue new handsets for its i-mode service from this month.

The operator had amassed 546,000 i-mode subscribers in the UK and Ireland — about only 3 per cent of its total customer base in those markets.

The decision to drop the service is a huge embarrassment for O2.

I-mode was supposed to be central to its push to encourage mobile users to tap into lucrative data services on their mobiles instead of simply calling and sending text messages.

I-mode was created by NTT DoCoMo, the Japanese telecoms giant.

It allows users easy access to tailored internet services such as booking cinema tickets or surfing for a weather forecast while on the move.

The success of the service in Japan — where it has more than 45 million subscribers — prompted O2 to tie up with DoCoMo to offer the service itself.

Their relationship has effectively been terminated.

O2 said that its existing customers would be able to continue with the service for a further two years.

It blamed the decision to drop the service in part on a lack of suitable handsets.

In a statement, O2 said: “The service has proven to be successful with rich content and high satisfaction amongst users.

“However, a limited range of devices has restricted its growth and we don't see that changing ... We will continue to manage and serve any existing UK i-mode customers until July 2009."

I-mode’s performance outside of Japan, where it has tie-ups with operators including KPN, the biggest mobile operator in the Netherlands, Bouygues and Telstra, in Australia, has been inconclusive.

According to DoCoMo's website, it has so far amassed only six million users in the 15 countries outside Japan — including Australia, France, Russia, Belgium and the Netherlands — in which it is offered.

The slow uptake follows a wider reluctance of consumers to treat their mobiles as mini PCs.

Calling and text messaging still account for the bulk of mobile operators' revenues.

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