BT launches mobile phone service

BT is seeking to counter a fall in fixed-line revenues

BT launched a new mobile phone service on Friday - three years after spinning-off its MM02 subsidiary.

The telecoms giant has been seeking to counter a fall in traditional revenue with moves into areas such as broadband

BT Mobile will be a "virtual network provider" with its customer's calls being carried over Vodafone's network.

BT will handle marketing and introduce its own range of services. It has already announced plans for a combined mobile and fixed-line phone service.

The move follows in the footsteps of Virgin Mobile, whose network is provided by T-Mobile, and comes as an existing contract between BT and MM02 ends.

BT had continued to offer mobile phone subscriptions after the MM02 flotation in 2001 and signed up 305,000 customers as a sales agent to both its former subsidiary and T-Mobile.

Those customers will be transferred to the new BT Mobile service over the next few months.