3GScottishUser
25th March 2007, 08:24 AM
O2 slashes cost of net access to keep customers
Mobile phone network O2 is slashing the cost of internet access for existing customers who threaten to leave as pressure builds on operators to reduce the price of using their 3G services.
Customers ringing O2's call centre wanting to switch to other networks are being offered a flat rate of £10 a month for web access. The deal is being offered only by the retentions team, and not all callers are eligible, but new subscribers are still being charged anything from £48 to £225 for the same level of access.
Britain's mobile phone operators have spent billions of pounds since 2000 acquiring and building third-generation networks, which offer high-speed internet connections. But these networks have remained largely unused because of a lack of suitable handsets and the high price of access.
The pricing structures are notoriously confusing for most consumers, with charges calculated according to the amount of information transmitted rather than the time spent online. There have been reports of users unwittingly racking up bills totalling hundreds of pounds after using their mobiles for bandwidth-hungry activities such as watching television.
Two years ago T-Mobile introduced flat-rate all-you-can-eat internet tariffs, and at the end of last year the newest British network, Hutchison's 3, began offering unlimited access from £5 a month.
The move prompted speculation that Orange, Vodafone and O2 would be forced to follow suit, finally kick-starting widespread use of the mobile internet. Some claim that O2's £10 retentions deals are a sign of things to come.
Steve Weller, the head of communications services at uSwitch.com, the price comparison service, said: "What we are going to start seeing is flat-rate monthly data deals as a bolt-on to existing packages. I'd expect some of the other networks to start mirroring the rates from 3 and T-Mobile."
A spokesman for 3 said O2's move mirrored developments four years ago when the price of voice calls was slashed after 3 abolished higher charges for -connecting to rival networks at peak times.
"The first thing we saw with voice pricing was rivals trying to match us in retentions but not on the high street," said the spokesman. "And then the same tariffs started appearing in their published price plans."
O2 said offers were made on a case-by-case basis. A spokesman said: "Retention teams always have the discretion to match or make offers to retain high-value customers. At the moment introducing flat-rate data tariffs is not part of our plan."
http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/03/25/cnotwo25.xml
Mobile phone network O2 is slashing the cost of internet access for existing customers who threaten to leave as pressure builds on operators to reduce the price of using their 3G services.
Customers ringing O2's call centre wanting to switch to other networks are being offered a flat rate of £10 a month for web access. The deal is being offered only by the retentions team, and not all callers are eligible, but new subscribers are still being charged anything from £48 to £225 for the same level of access.
Britain's mobile phone operators have spent billions of pounds since 2000 acquiring and building third-generation networks, which offer high-speed internet connections. But these networks have remained largely unused because of a lack of suitable handsets and the high price of access.
The pricing structures are notoriously confusing for most consumers, with charges calculated according to the amount of information transmitted rather than the time spent online. There have been reports of users unwittingly racking up bills totalling hundreds of pounds after using their mobiles for bandwidth-hungry activities such as watching television.
Two years ago T-Mobile introduced flat-rate all-you-can-eat internet tariffs, and at the end of last year the newest British network, Hutchison's 3, began offering unlimited access from £5 a month.
The move prompted speculation that Orange, Vodafone and O2 would be forced to follow suit, finally kick-starting widespread use of the mobile internet. Some claim that O2's £10 retentions deals are a sign of things to come.
Steve Weller, the head of communications services at uSwitch.com, the price comparison service, said: "What we are going to start seeing is flat-rate monthly data deals as a bolt-on to existing packages. I'd expect some of the other networks to start mirroring the rates from 3 and T-Mobile."
A spokesman for 3 said O2's move mirrored developments four years ago when the price of voice calls was slashed after 3 abolished higher charges for -connecting to rival networks at peak times.
"The first thing we saw with voice pricing was rivals trying to match us in retentions but not on the high street," said the spokesman. "And then the same tariffs started appearing in their published price plans."
O2 said offers were made on a case-by-case basis. A spokesman said: "Retention teams always have the discretion to match or make offers to retain high-value customers. At the moment introducing flat-rate data tariffs is not part of our plan."
http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/03/25/cnotwo25.xml