Now a mobile that lets you watch television

Virgin Mobile has signed up the former Baywatch star Pamela Anderson as part of a £2.5m marketing campaign to promote the UK's first mobile phone service that offers broadcast television and digital radio.

The mobile television service will launch next month and will initially broadcast BBC1, ITV1 and E4. Channel 4 will broadcast its made-for-mobile channel "Short Cuts" but is expected to offer a full broadcast of its content in the future.

Sky channels, which were included in trials of the service, will not be available. Alan Gow, Virgin Mobile's managing director, denied Sky had been excluded because it competes against the mobile company's parent, NTL, in the television and broadcast sectors. He said BT, which provides the platform that enables the broadcast of television on to phones, had selected stations based on popularity.

Initially, the mobile television service will not broadcast advertisements because of disagreements over broadcast rights.

BT is in talks with other operators about similar wholesale arrangements to Virgin's. As part of the deal, Virgin has a period of exclusivity in broadcasting the channels, although other mobile operators are likely to follow suit. Virgin will pay to use BT Movio's platform on a per-user basis, reducing the risk of the service failing to entice consumers.

To date, UK consumers have been able to watch streamed television services on mobile phones over the third-generation networks of Vodafone, Orange and 3. However, those services use large amounts of capacity and picture quality can deteriorate if too many users stream the content at the same time. Broadcasting television to mobiles solves this problem as the content is delivered over a different frequency.

Virgin Mobile expects the television service to drive customer growth and retention. The service will be available for free to contract customers who spend at least £25 a month, while pay-as-you-go subscribers, which make up the bulk of Virgin's customer base, will need to buy a special handset for £199 and pay £5 a month after an initial three-month trial. Subscribers wanting only to watch the BBC or access the digital radio stations can opt not to pay the subscription.

The service will initially be available on one handset - the Lobster 7000 - developed by Korea's HTC. BT is in talks with the Chinese handset manufacturer, ZTE, to develop further models with a deal potentially agreed by next week.

Hasselhoff brings in broadband customers

The decision by Pipex Communications to spend £3m on a marketing campaign starring David Hasselhoff, another former Baywatch star, has paid dividends, driving a 50 per cent increase in its broadband customer growth.

Peter Dubens, the Pipex chairman, said the decision to hire "the Hoff" to promote its voice and broadband products has doubled its brand recognition to 50 per cent.

Pipex continued to implement its aggressive growth strategy after snapping up Toucan broadband for £24m and the residual customer base of Bulldog, the Cable & Wireless unit, for £12.5m.

The deals added nearly 300,000 customers to Pipex's base of 832,000 voice and broadband customers. Pipex also signed a wholesale agreement with C&W as part of the deal.