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Virgin hails 'free' landline-to-mobe calls

Keeping it in the family

Top three mobile application threats

Virgin Media is to offer customers free calls from their Virgin landlines to their Virgin mobile phones. As always, strings are attached.

Strictly free calls are reserved for the upcoming weekend-only 'Size M' plan. Add weekday evenings into the mix for 'Size L' and you pay £3.45 a month. For the 24/7 'Size XL' tariff you pay £7.95. Line rental for all three tariffs is £11.99 a month.

Not so much free, more certainty of charges - and reasonable charges, at that. This plays well to consumer psychology, accustomed as we all are to the outrageous prices that operators dream up when we call mobile phones from our landlines. UK landline-to-mobile call traffic drums up £1.6bn a year in operator revenues, according to Virgin, which presumably picks up a pleasing chunk of this. So why should it torpedo such a nice not so little earner?

The answer lies in Virgin's ambitions to build a quad play UK telco, straddling TV, cable and ADSL broadband, mobile and fixed telephony. The company may lose a little in individual elements of the bundle but it makes much more money in the long run: people who choose all four services are very profitable and less susceptible, we suspect, to "churning" than single-service rates tarts.

Virgin's recruiting sergeants have some work to do: the company has half a million, quad-play customers, compared with more than four million home phone customers and 10 million customers in total.

Virgin Mobile Press release

Top three mobile application threats

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