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Post Office™ Articles

Press Release: 24 February 2009

Pay As You Go Pays Off

Quarter of people considering ditching mobile contracts in favour of Pay As You Go

The landscape of the mobile phone market is set to alter dramatically in coming months as 6.5 million users consider switching from a mobile phone contract to a Pay As You Go (PAYG) option because of the economic climate.

A further three quarters of a million people (723,000) say they are already in the process of switching, according to a report out today from Post Office® Telecoms.

There are already more than 32.7 million PAYG users in the UK, making up 54 per cent of the population, and this recent study indicated it could increase to a possible market share of around 65 per cent.

In recent months some Post Office branches have seen an increase in sales of mobile top ups of over 100 per cent and, as the UK’s second largest provider of the service, the network is bracing itself for a sharp increase in sales during 2009.

Martin Moran, Post Office head of telecoms, said: “Clearly people are being mindful of their finances during difficult times, and taking control of their spending by switching to more manageable options for mobile phone costs.

“59 per cent of people say that having a PAYG mobile allows better control of spending and in some Post Office branches we’re seeing record numbers of people topping up their mobile phone at the counter.

“The Post Office also offers customers the option to pay many bills in cash, including our HomePhone and broadband services, which can help them control their spending in an easy and transparent way. We’re preparing ourselves for an increase in use of these services as the financial crisis deepens.”

According to one in five people PAYG is a good option if you have a bad credit rating, with 31 per cent of under-25s citing this as a reason to use PAYG. The under-25s were also the wariest about signing a monthly contract (67 per cent).

Regionally, mobile phone users in the South West were the most likely to switch from contracts to PAYG (40 per cent).

The top reasons for topping up rather than signing up to a contract were:

1. You only pay for what you use (69 per cent)
2. You have more control over you spending and won’t be saddled with bills you can’t afford (59.2 per cent)
3. You don’t feel the pressure of being tied into a contract (58 per cent)
4. You don’t need a good credit rating (21 per cent) 5. They are simpler to understand (15 per cent)

To find out more about Post Office E Top-Ups and the Post Office’s other telecoms services, which include HomePhone, Broadband, directory enquiries and International Phonecards, ask at any Post Office branch nationwide.

Notes to Editors

All stats unless otherwise stated obtained from research carried out by T-Poll among over 2,000 people aged 18+ in the UK. All numbers are rounded to the nearest 1 per cent or 250,000)

London/South East

• 47% of people in London and the South East use a PAYG phone
• 26% of people in London and the South East are considering switching to PAYG
• 59% of people in London and the South East believe PAYG means you have more control over your spending

South West

• 56% of people in the South West use a PAYG phone
• 35% of people in the South West are considering switching to PAYG (highest in UK)
• 52% of people in the South West believe PAYG means you have more control over your spending

Midlands

• 53% of people in the Midlands use a PAYG phone
• 23% of people in the Midlands are considering switching to PAYG
• 56% of people in the Midlands believe PAYG means you have more control over your spending

North West

• 54% of people in the North West use a PAYG phone
• 32% of people in the North West are considering switching to PAYG
• 63% of people in the North West believe PAYG means you have more control over your spending

Scotland

• 57% of people in Scotland use a PAYG phone
• 27% of people in Scotland are considering switching to PAYG
• 64% of people in Scotland believe PAYG means you have more control over your spending

Wales

• 61% of people in Wales use a PAYG phone
• 28% of people in Wales are considering switching to PAYG
• 58% of people in Wales believe PAYG means you have more control over your spending

Northern Ireland

• 64% of people in Northern Ireland use a PAYG phone (highest in UK)
• 22% of people in Northern Ireland are considering switching to PAYG
• 71% of people in Northern Ireland believe PAYG means you have more control over your spending (highest in UK)

East of England

• 57% of people in the East of England use a PAYG phone
• 31% of people in the East of England are considering switching to PAYG
• 56% of people in the East of England believe PAYG means you have more control over your spending

The Post Office offers a range of great value telephony products and services:

E Top-ups

E Top-ups and E Vouchers for all mobile networks are available at all Post Office branches

Phonecards

Post Office branches offer a range of great value domestic and international phonecards

Post Office Broadband and HomePhone

The new Post Office Broadband service was launched in October 2007 and offers customers a cash prepayment option, fast connection speeds, no rural surcharges and a range of great value packages, including bundles with the Post Office’s telephone service – HomePhone.

Post Office 118855

Its directory enquiries service – 118855 – offers one of the most competitive prices on the market with all calls charged at a flat rate of 39.1p from a BT landline (no per minute charges). Customers can get two searches per call and free text back to mobiles.