O2 Fighting Back Thanks To Tesco

When i discovered Tesco was to distribute the iPhone 3G & 3GS through the O2 network i thought here we go, price war on.

However, when Orange announced their iPhone tariffs would be the same as O2 the thoughts "uncompetitve, monopoly, bad for consumers' sprang to mind.

Now the news is out that Tesco Mobile will not only undercut current monthly tariffs by up to a third, but also offer 12mth contracts as opposed to the standard 18 or 24 mth offerings of O2 and Orange.

There is a caveat. The upfront charges for the iPhone on a 12mth contract are higher than O2 and Orange at £222. Also the 600 minute call package you get with O2 will be half that. Tesco's unlimited calling tariff will set you back £60 per month with a 24 mth contract.

Still it's good news for those on a budget and indirectly gets O2 back in the frame as i predict a mass exodus away from O2 over to Orange's much larger network coverage.

With Vodafone coming onboard and then T-Mobile in 2010, which will eventually merge with Orange to create a super huge network, i'll predict that the iPhone will be the UK's number one selling phone in 2010.

As they say at Tesco "every little helps".