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Originally Posted by DRNewcomb
I never quite understood how, in any country larger than the Netherlands, a 3G-only carrier was going to be able to compete. It seemed to me, that the issue of coverage was going to be hard to get around.
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Well yes, but they do also have 2g roaming on O2, soon to be replaced by a deal with Orange.
This incurs costs to them of course, which looked a bit odd when in the early days their early contracts had cheaper pro-rata per minute calls than any other network. I live just outside the 3g coverage, so some of my 500 minutes of calls a month for only ?15.88 a year (after cashback of line rental) must have been costing them money straight to O2.
They still have higher termination fees for received calls than the other networks, and I've seen these differentials described as effectively a subsidy (ie equal time of calls to and from 3 and another network results in a net transfer of funds)
At the moment they have a cheap international calls option on both contract and prepaid of ?15 a month for up to 3000 minutes fair use. Using callthrough in say USA, this could be used for UK landlines as well.