BT And Vodafone Ink Mobile Deal For UK

18 May 2004

Telecoms giant BT is signing a deal with its old rival Vodafone which could be worth billions of pounds.

The agreement with the mobile phone giant precedes this Thursday's annual results which are expected to make gloomy reading for BT.

The deal provides customers one bill for fixed and mobile calls for the first time.

As part of the agreement BT will end its agreements with mmO2 and T-Mobile, which provide calls for the business and consumer sectors respectively.

For its part Vodafone will provide BT's own-branded services on its network.

Three years ago BT spun-off its mobile arm, mmO2, but last November the company re-entered the mobile sector after sales of residential lines slowed.

However, its BT Mobile Home Plan failed to pull in consumers despite a £5 million marketing campaign.

Many analysts believe BT moved too late because the mobile sector is saturated with services from Vodafone, Orange, mmO2 and T-Mobile.

The deal will have to be cleared by Ofcom, the industry regulator, which has been highly critical of the former state monopoly.

Data sourced from; additional content by WARC staff