O2 chases iPhone market with price cuts

Having gained hugely from its exclusive rights to sell the iPhone in the UK, O2 has responded to growing competition from Vodafone, Orange and Tesco Mobile with the launch of a new SIM-only contract.

Under the new deal, UK customers who already own an iPhone can choose from a range of SIM-only tariffs starting at £15 per month for 300 minutes, unlimited UK texts, data and Wi-Fi on a 12-month SIM-only contract, or from £20 per month on a 30-day rolling contract.

Sally Cowdry, O2 marketing director, said: "Customers' habits are changing, with more texts and data being used than ever before. We have listened to our customers and introduced a range of new tariffs with unlimited calls, texts and data offering real value for money."

More controversially, Cowdry said that the company would also introduce a new £2 per day Internet Tethering Bolt On. "We know our iPhone customers want to snack when they are using their iPhone as a modem. We have always been the home for texts and now want to extend that to being home for data."

Vodafone at the beginning of February introduced new SIM-only price plans that it claimed were "great for iPhone customers." Available from £25 a month they offered "unlimited" texts--subject to a fair usage policy, 1Gb data and BT Openzone Wi-Fi access.

Separately, O2 said it had added over one million contract subscribers in the UK last year to take its total customer base to 21.3 million, a 5.1 per cent increase year-on-year.

For more on this story:
Marketing Week

Related stories:
Vodafone achieve early hit with iPhone, Nexus One bombs
O2 doubles price of new iPhone, blames lower subsidies
UK iPhone price war opens with free add-ons
O2 to crack down on iPhone tethering cheats

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