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The T-Mobile mobile phone network began life as Mercury One2One - a spin off from the Mercury landline network in the UK. Launched in September 1993 - a decade after the launch of the first two GSM infrastructures (Vodafone and BTCellnet) - Mercury One2One was the UK's first fully digital mobile network.
Unlike the early licences awarded to BTCellnet and Vodafone, the second-generation licence granted to One2One (a joint-venture company owned equally by telecommunications giants Cable & Wireless and US West) and Orange (a division of Hutchison) allowed both networks to sell mobiles and airtime directly to customers.
These networks were known as Personal Communications Networks (PCNs). They operated at DSC1800, which refers to the operating frequency (1800 MHz) as opposed to the GSM standard which operates at 900 MHz. But for customers, the truly significant difference between the two PCN and the two GSM networks was the bundling of airtime with a mobile package.
One2One reached out to customers with a personalised message, heavily branded as One2One with what the industry calls a "two box" proposition: firstly, the SIM card to access the network service and secondly, the mobile phone. Vodafone and BTCellnet offered a "one box" solution, selling only airtime and not mobile phones.
This gave One2One an advantage of sorts and it threw its weight behind the creation of a brand, establishing a network around the M25 motorway network in London, operating at 1800 MHZ - twice the frequency of GSM. This offered superior quality and, for a short window of opportunity, a higher capacity while Vodafone and BTCellnet worked as fast as possible to upgrade their network infrastructures.
One2One's strategy seemed simple and logical enough - create a network infrastructure covering each major city in the UK one at a time. It went about creating network infrastructure in London first, then Birmingham, followed by all the UK's larger cities. The strategy was flawed - One2One customers were unable to receive coverage while travelling between cities.
At first, retailers were able to convince customers to call once they reached their destination. However, as mobiles began to become indispensable, One2One's competitors - such as Orange, which launched at the same time - forged ahead leaving One2One struggling to attract new customers to its urban-centric network.
One2One's response was a series of innovative marketing campaigns that set the tone for today's packages. Most notably, the network began to offer its customers a bundle of free minutes for a subscription each month. Around the M25 London area, customers rushed to take advantage of some of the early offers of unlimited free calls every month. In fact, some of these early bird customers still have the original SIM cards with unlimited free calls.
One2One also dropped its call charge rates from 40p per minute down as low as 10p a minute and then went on to simplify the proposition by creating cross network and "anytime" minutes. As a result, the original networks (BTCellnet and Vodafone) were forced to lower their prices to keep up with the new PCN networks. While One2One was the clear leader in offering customers the cheapest calls, it was still to suffer for years to come from the stigma of poor coverage.
As networks around the world rushed to gain market share in a bid to keep up with Vodafone's rampant global expansion, Germany's Deutsch Telekom network bought 100% of the One2One network in the UK and immediately re-branded the network as T-Mobile. At the same time, it began to invest heavily in expanding the former One2One network to cover the gaps, spending as much as £1 million per day over the next few years. The new T-Mobile network also created lucrative incentives via its dealer network in a bid to spread the word and acquire market share aggressively.
The strategy paid off and T-Mobile UK is now a well-respected network with almost 25% market share. The legacy of customers it attracted meant a preponderance of customers leaned heavily towards prepay rather than subscriptions. However, under the new German management, the network made up significant ground by increasing its share of subscription-based customers.
T-Mobile is now in a competitive position and continues to pioneer innovative price plans and services, such as the recent Flext service that allows customers to use a bundle of shifting minutes or texts depending on the specific customer's usage patterns. T-Mobile also acquired a 3G licence and now offers its customers Internet connectivity, data download, email and video calling services on its network.
At moneysupermarket you will find the full range of T-Mobile mobile phones. We deal direct with the T-mobile network and we have the strongest commercial packages available to us due to the large number of customers we connect to the T-Mobile network. These strong commercial packages mean that we are able to offer most of the T-mobile range of mobile phones free of charge, together with large cashback incentives.