The Post Office has revealed ambitions to ‘be in the same market as Carphone Warehouse’s iD
brand’, following the launch of its new MVNO.
Post Office Mobile will operate on the EE network and will attempt to take a share of the ‘11m op-up transactions’ that are carried every year in store.
Speaking to Mobile, Geoffrey Smyth, head of telecoms, explained that the MVNO will ‘aggressively’ focus on the SIM-only, PAYG and pay monthly markets. He claimed that the MVNO’s late market entrance will not harm its chances of success, instead believing it has allowed the Post Office to ramp up its mobile offering.
He said: ‘Being late has allowed us to include 4G in our offering – if we had signed the EE deal a year earlier this would not have been the case. We do believe our brand will provide a massive cut-through; the value segment is under-sold so the brand and segment will connect closely and we have a price point that also talks to the same segment. You wouldn’t see us in the high-end market, we will be in the value handset base. We plan to be relatively passive in the handset market but we’re looking to aggressively target SIM-only, PAYG and pay monthly services.
‘We are launching 4G services in 60 days and deliberately made the decision to do so. It’s important to know what customers will be buying the bundles, and while we have lost nine months to a year in the market, we’re looking to be cautious in the 4G space. There are some great products out there, including Carphone Warehouse’s iD MVNO, and we have an ambition to be in the same market. We’re up and running but now we have to go out there and demonstrate it – we want to be at 500,000 subs in the next three to five years.’
The new MVNO will look to compete with the likes of Lebara and Lyca in the niche market, as well as the main operators in the mass market. Smyth explained that the company will target existing customers, and that brand recognition will see the Post Office stand out in the crowded mobile space.
‘Our main competition will be niche MVNOs such as Lebara and Lyca, in terms of mass market it would have to be the main operators. However, we believe in the brand and the fact that customers can come into their local Post Office will differentiate us from the rest.
‘We’ll be targeting the traditional Post Office customers – within the brand there will be various materials encouraging individuals to be asking at the counter for PAYG and bundle packages. We’re trying to tap into the market through our value proposition. People are coming into the branch and are paying too much elsewhere and that’s a very strong value message.’
Smyth explained that the Post Office’s entrance into mobile stems from the market shift towards bundle packages. He explained that the company will look to target existing customers who will be looking to take a bundle package. While he says the Post Office has no ambitions to extend its reach into the pay TV market, the high street brand believes that tri play ‘is a market worth looking at’.
He said: ‘The Post Office has had a dual play [fixed line and broadband] offering for some time and as we saw the market move towards bundles we took a serious look at our strategy. We determined that we needed a bundle, however the Post Office didn’t see itself in the pay TV market because it is very expensive. BT and Sky have spent a lot of money on content, as has TalkTalk, and that led us to look at the successful bundles in mobile. We decided that tri play is a market worth looking at.’