Swedish telecommunication provider Tele2 AB and Consignia PLC, formerly the U.K. Post Office Group, are to launch a joint venture offering prepaid fixed-line telephony services in the U.K. beginning Nov. 19, the companies announced Thursday.
The low-cost service will offer national long-distance, international and fixed-to-mobile calling. Customers will buy an i-hear phone with a preselect facility as part of the initial offer, Tele2 and Consignia said, and will use prepaid cards bought from the Post Office's 18,000 U.K.branches. The service can also be paid with a credit card, the companies said in a statement.
The U.K. Post Office Group officially changed its name to Consignia when the company was floated as a public company on March 26. The U.K. government owns a majority share in Consignia.
The joint venture marks the first time that the Post Office has offered telephony services since British Telecommunications PLC (BT) was divested from the Post Office in 1981. However, Consignia began competing directly with BT when it began offering calling cards, for use over BT phone lines, on Oct. 15 as part of its long-term agreement with Tele2, the companies said.
The new telephony services will be similar in structure to the offerings Tele2 already has in other European countries like France and Germany.
Tele2, which claims to have 13.7 million customers in 21 countries, sees its partnership with Consignia as the best way to enter the U.K. market. This is due primarily to the Post Office's wide distribution network, the companies said. Each week, 28 million people visit a post office branch, Tele2 and Consignia said.