BT slashes prices in mobile push

BT is bouncing back into the mobile space after a two-year hiatus, with cut-price deals for early customers

BT's re-entry into the mobile phone market will be marked by a massive advertising campaign and special offers for the first wave of customers who sign up for its new service, the company announced on Thursday.

BT Mobile Home Plan will launch on 1 November, backed by a £5m advertising campaign that will fight for eyeballs over the Christmas period. It is the result of a partnership with T-Mobile, which BT hopes will help it to make £300m per year from mobile services by 2005. The company faced criticism in 2001 after selling off its Cellnet mobile arm -- now called mmO2 -- as analysts claimed that the telco would miss out on this major growth area. However, unlike the likes of Vodafone, Orange, T-Mobile and mmO2, BT has no mobile products for the business sector.

The Home Plan is designed to appeal to families that have several mobile phones, by allowing them to combine usage into a single bill and providing free two-minute calls to their BT home phone line. Line rental will cost £12.50 a month for the first phone, and just £10.00 line rental for each additional BT Mobile.

BT says that in many circumstances it will save households money -- a claim it backed up with research from Deloitte and Touche.

Any family that jumps onboard the BT mobile bandwagon before the end of this year will be rewarded with free handsets -- from a choice of four -- and three months' free line rental for each subscription.

"The scale of activity around the launch of BT Mobile Home Plan in the high street shows how serious our intentions are in the consumer mobile market," said Pierre Danon, chief executive of BT Retail, in a statement.

"Over the coming months customers can expect to see a stream of competitive new services which will be available to BT Mobile Home Plan users as part of our aggressive strategy to re-enter the consumer mobile market," Danon added.

BT is aiming to launch an 'infotainment' portal early next year for users who want to download ringtones and mobile games, and is also working on a cheap method of sending texts from a fixed line.