BT Starts Selling Mobile Plans in the U.K. Ahead of EE Deal

25 Mar 2015 | Author: | No comments yet »

BT Starts Selling Mobile Plans in the U.K. Ahead of EE Deal.

Designed as a lure for BT’s broadband service – the group’s main moneyspinner – mobile subscriptions will come at up to half price for BT broadband customers.LONDON (Reuters) – BT took a first step back into the consumer mobile market on Wednesday while its awaits a decision from regulators on its deal to buy EE, the country’s biggest mobile operator.(Bloomberg) — BT Group Plc started selling wireless plans to U.K. consumers a day after after rival O2 agreed to be acquired by Hutchison Whampoa Ltd. in the latest round of operator consolidation in Britain, which has more mobile subscriptions than people.

BT said it was launching a SIM-only deal – giving subscribers calls, texts and data but no handset – with the best offers reserved for its existing customers, starting from 5 pounds per month. With monthly packages starting at 5 pounds ($7.50) for existing broadband customers and 10 pounds for new clients, BT’s push back into mobile could increase pressure on rivals including Vodafone Group Plc, Liberty Global Inc.’s Virgin Media and TalkTalk Telecom Group Plc. The former state-owned telecoms company, which is in the process of acquiring the EE network for a fully fledged assault on mobile when the £12.5bn deal is completed, is dipping its toe in the market with a limited service offering airtime but no handsets. Its rivals, wary of the group’s potential dominance, particularly in providing the infrastructure that mobile operators rely on, have called on regulators to intervene in the deal. “Offering BT customers the UK’s best value 4G data deal is a great way to start our journey towards re-establishing ourselves as a major player in consumer mobile,” John Petter, chief executive of BT consumer, said in a statement on Wednesday. The 12.5 billion-pound ($18.6 billion) deal will create the biggest phone company in Britain offering landline, wireless, broadband and TV service and is expected to be completed next year.

The new BT service, launched on Wednesday, will run over airtime rented from EE, and will combine mobile airwaves with access to BT’s network of 5m Wi-Fi i hotspots. Spain’s Telefonica said it had finalised a deal to sell its British mobile business O2 to Li Ka-shing’s Hutchison Whampoa for 10.25 billion pounds on Tuesday. The discounted rates will be offered for up to five devices per household. “Rivals should be threatened by this move and Sky in particular will need to react given how punchy BT’s sim-only deals are,” said Hugo Dixon of analysis firm CCS Insight. “With this in mind Sky may need to launch mobile a lot sooner.” Dixon said he expected a low-key launch, building to a bigger marketing assault on the mobile market over the summer. The deal paves the way for Hutchison to merge its Three business with O2 — the carriers together have more than 30 million subscribers — in a move that would reduce the number of U.K. wireless networks to three from four. Its has already retaliated against Sky with a foray into football, spending billions on Premier League and Champions League matches and a brand new broadcasting studio in east London.

It’s our ambition to meet this demand by combining the power of our fixed fibre service with wi-fi and the convenience of mobile.” The cheapest offer is for 500mb of 4G data, unlimited texts and 200 minutes for £5 a month for those who take BT broadband, £10 a month for those who do not. Vodafone will also start selling Internet and TV services later this year, and Sky Plc reached a deal with O2 to add mobile to its pay-TV and broadband packages. BT already challenged Sky when it started offering free access to exclusive sports broadcasts to broadband customers in 2013 and outbid its pay-TV rival for some of the most popular rights, including the U.K.’s Premier League soccer games. U.K. regulator Ofcom started a strategic review of the industry this month to examine competition and investment issues, the first such probe in a decade.

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