O2 Officially Launches Broadband-Phone Bundle

Mobile operator O2 has officially launched the O2 Home Phone service, giving its UK customers the option of a combined broadband and home telephone package from £9.50 per month.

A Bit Late

Earlier this year O2 revealed that from March 2010 it would offer a home phone to new and existing home broadband customers. The official launch is therefore a couple of months later than expected, but it will allow O2 to squeeze more revenue from a saturated mobile phone market.

The idea is that, with a combined bundle, customers will have the convenience of having their broadband and home packages combined into one simple bill.

O2 is now owned by Spanish telecoms giant Telefonica, and this move will see the UK operator come into direct competition with its former owner. BT used to own O2 (then called BT Cellnet), but sold off the mobile operation in November 2001 in order to reduce its debt burden at the time.

O2 Home Phone

Pricing for O2 Home Phone starts at £9.50 per month for unlimited evening and weekend UK calls or £12.50 per month for unlimited anytime calls to UK homes, as well as landlines in over 20 international countries.

Meanwhile, if line rental is factored in, prices for the home phone, broadband cost from £17 per month. Additional features such as call divert, caller display, call waiting and call barring can be added as bolt-ons.

These prices are intended for O2 customers only, and new customers will face an additional £5 on both packages. It also assumes you are living in an O2 unbundled area.

“At O2, we’ve been listening to our customers and we’ve realised that many of them want great value, an end to hidden costs and the convenience of being able to pay their home phone and broadband bills together,” said Sally Cowdry, O2 Marketing Director.

“That is exactly what they will get from us now we have launched Home Phone – truly transparent and flexible pricing plans and convenient consolidated billing,” she said.

In February, O2 announced that it had signed a new five year, multi-million pound managed services agreement with BT. BT Wholesale is to consolidate O2’s mobile and fixed core networks in the UK into “one cost-effective network” under the deal.

“The five year contract is to provide the backhaul (i.e. core network traffic) for O2’s LLU (local loop unbundling) operation,” explained a BT Wholesale spokesman to eWEEK Europe UK at that time. BT Wholesale already provides core network management support and a managed network service for O2’s mobile broadband customers.