O2: market leader or opportunist?

O2: market leader or opportunist?

While T-Mobile’s now annual Q4 cash drought is bordering on the comical, with another final three months of the year that sees it turn away upgrading customers, it is more alarming that O2 is also going to go three months while trying to stop Christmas upgrades ahead of its financial results.

O2’s behaviour has indicated some clear beliefs: it is reluctant to subsidise top-end handsets, and is now reluctant to upgrade customers with ‘free’ hardware. Does it genuinely have the conviction that it can stop the free phone model? As the market leader in terms of financial performance, brand and innovation, it is entitled to believe it is in a position to act as a leader.

But the behaviour appears as much a function of circumstance as a deep underlying strategy. O2 is clearly low on cash for this financial year, and is trying to push any upgrades into next year, as well as trying to encourage customers to sign up to Sim-only deals.

There is also a case that O2’s cash has been drained by subsidising the iPhone, and it is hellbent on meeting its targets to hold on to any future Apple exclusives. The long-term effect will depend on O2’s performance over the next three months. The deepest impact will be on manufacturers. Trying to move away from free phones, and encourage Sim-only deals, will leave O2 as the enemy of the manufacturers.

If O2 continues to be the success story among the operators, it will undoubtedly continue with its steps to pull money out of subsidies. Manufacturers will be keeping their fingers crossed that O2 customers will leave for a network that has a more traditional approach to giving customers free phones.

Written by Mobile Today
Mobile Today


Please wait...

Please write code to prove you're human