MmO2 to launch computer games service for mobile customers

The mobile phone operator mmO2 is to launch a new computer games service that its 11.1 million users in the UK will be able to access on their handsets.

The company, formerly known as BT Cellnet, will launch its so-called 'games arcade' service on 1 September in an effort to hang on to customers while encouraging them to spend more.

The service will be free for a month. After that users will be charged £1.50 for each game they download onto their handset, and will also be charged a small fee for receiving the data. The game will operate for a period of 30 days,

MmO2 reckons the service could boost its revenues by about £800,000 a month from the middle of next year when it predicts about 3 per cent, or 600,000, of all its UK and European users will be downloading a couple of games a month. It will share half of the £1.50 charge with the games companies.

The move is the latest in a string of offensives that mobile phone operators are employing to encourage their customers to spend more and therefore increase their closely-watched Arpu, or average revenue per user, data.

MmO2 users, who will need to buy a so-called 'java-enabled' phone to use the service, will be able to play older generation games such as Asteroids and Breakout as well as newer games such as Men in Black II and Racing Fever.

Kent Thexton, mmO2's chief marketing and data officer, said the launch was "something of real substance" and a product that would generate revenue for the company rather than just "hype".

"We believe that the O2 games arcade and multimedia messaging, which we will launch shortly, are highly desirable mobile data applications that our customers will embrace," he said.

Nevertheless, he conceded that the service could be slow to take off initially because of the lack of java-enabled mobile phones on the market.

The service will launch on a Nokia 3410 handset which is capable of storing three to four games at any one time. Other handsets, such as the Siemens M50 model, are expected to be available before Christmas.

MmO2 said it planned to roll out the new service to its customers in Germany, Ireland and the Netherlands in October.