T-Mobile retaliates with rise in handset prices

The German-owned mobile phone operator T-Mobile, which was known as One2One in the UK, said yesterday the planned price caps imposed on it by the Competition Commission had forced it to raise the price of handsets in the UK.

From the beginning of April, it is cutting subsidies by about a third on its handsets – a move that will see the price of its phones rise by £40 to £60.

Christina Meade, the sales director at T-Mobile UK, said: "This measure was inevitable in the wake of the Competition Commission recommendations and I am interested to note that other operators are thinking along similar lines."

The company said mobile phone dealers would see a change in the structuring of the commissions they received with the best reward on "high value and business users".

T-Mobile said it was preparing to file documents that will kick off a judicial review into the Competition Commission's proposals to cut the cost of making calls to mobile phones.

Separately, the operator also said it would launch a video-messaging service on its network from the beginning of April.