Danish telecom company TDC and T-Mobile have launched a low-price, no-frills mobile service in the UK, called easyMobile.
Beginning March 2005, the two will offer a Web-based telephony service, in which customers buy a pre-paid SIM card for their existing handheld and manage their account online. TDC experienced some success with a similar service in Denmark dubbed Telmore, which claimed 10 percent of the market within four years of launching.
The company is now planning to dial into other markets by using the easyMobile name, which it has licensed from easyGroup to use in up to 12 European countries. First it's testing the UK market using T-Mobile's infrastructure. Telmore founder Frank Rasmussen will serve as chief executive officer of the new business.
The easyMobile service offers voice and SMS and is available for all mobile customers who use second-generation handsets, a spokesman for TDC said. Prices are yet to be announced but are expected to be lower than those offered by the UK's major mobile providers.
As a comparison the TDC spokesman said Telmore charges 0.80 krone (7.5p) per minute for voice, compared to the average mobile voice charge in Denmark of 1.10 krone (10.4p) per minute.
The easyMobile service could lead to an overall reduction in UK mobile tariffs, according to a report by analysts at Ovum. It is likely to put pressure on other mobile operators, the analysts said, and won't win many industry friends for T-Mobile.
T-Mobile, which is the UK wireless arm of German telephone giant Deutsche Telekom, already has a wholesale deal with Virgin Mobile in the UK, but easyMobile will give it added revenue without taxing its network, the analysts said.
Like Telmore, the easyMobile concept is based around lean operations, a small marketing budget and no physical store locations. Although the service is basic, TDC is hoping that customers appreciate the cost savings. In Denmark, Telmore customers called to complain that the company was wasting money when it ran a TV ad for the service, the spokesman said.
Now it remains to be seen if UK customers are as thrifty.