One2One hikes prepaid handset rates

NEWS From May the three cheapest One2One handsets will cost £69.99, up from £39.99. UK mobile phone companies have traditionally sold handsets with heavy subsidies, as they vied with each other to sign up new customers. Now that UK market is reaching saturation, One2One is shifting its focus onto retaining existing customers, rather than scrambling for new ones, a spokeswoman said. One2One also hopes that the move will encourage more customers to move onto monthly contracts. £39.99 is well below the cost price of a handset, and a subsidised UK handset can be sold abroad at a considerable profit. The scale of the racket is not known, but it is believed to cost UK mobile networks considerable sums. However, One2One said that the move is not primarily aimed at cutting handset smuggling. Deutsche Telekom, which owns One2One, is under considerable financial pressure and is desperate to cut costs. Today also saw the announcement of the rebranding of One2One's business services. They will henceforth be branded T-Mobile, in line with Deutsche Telekom's T-Mobil service in Germany. The One2One name will be kept for other services. Mobile data services will also be important in increasing One2One's customer revenue. The company will be launching GPRS services for businesses in April or May, a spokeswoman said, and rolling out to the general public in Q4.