Post Office broadband service to be launched under deal with BT

The Post Office will launch a broadband service later this year under a strategic partnership with BT Wholesale.

The agreement marks a key step in the Post Office's drive to expand its range of services and products to generate new revenues to support the branch network by helping replace lost income from a decline in its traditional business.

Alan Cook, the Post Office's Managing Director, warmly welcomed the deal, saying: "We're delighted to have BT as a partner in a deal that gives a tremendous boost to the Post Office's determination to be one of the leading players in the telecoms market.

"The agreement provides the platform to enhance the Post Office's existing HomePhone service while offering customers some of the best deals in the market for both voice and internet broadband services."

Paul Reynolds, Chief Executive at BT Wholesale, said: "This is a landmark agreement between two of the UK's leading and best established businesses. It will help to quickly establish the Post Office as a key player in an exciting, dynamic and ultra competitive market for broadband-based services.”

Under the four-year deal, BT Wholesale will provide an integrated range of telephony and broadband services.

It builds further on the Post Office's growing range of new services and products, including car and home insurance, Instant Saver accounts, the Post Office credit card and personal loans, as well as increasing sales of foreign currency and travel insurance.

The first benefits from the agreement will be unveiled next month when Post Office HomePhone launches a new price and service package that will strengthen further its existing competitive offering. HomePhone has already won 400,000 customers with the lowest line rental prices of any major provider if payment is by direct debit, along with itemised billing, and discounts against favourite numbers.

Work is already underway by the Post Office to launch a broadband service in the autumn that will compete head to head with the major players in the market.

Mr Cook said: "The Post Office wanted a partner that could help us provide one of the best and most customer-focused voice and broadband services in the telecoms market at leading edge prices - and with BT, we're very confident we've got the best strategic relationship to provide our customers with a trusted and reliable service at leading edge prices.

"We're convinced there is a real demand in the telephony and broadband markets for a value-for-money service from a trusted provider and this deal puts the Post Office in a very strong position to compete. The real winners will be the customers."

Mr Cook added: "It's vital the Post Office earns earn more revenue from new services in order to have a sustainable future. Expanding our range of telecoms services will play a key role going forward and help create a long-term sustainable branch network. At the same time, we aim to grow further our financial services and banking business, build on our strong presence as the shop window for Royal Mail's postal services, while remaining a key provider of Government services despite the decline in our income from this sector.

"The Post Office's reputation for trust, its instantly recognisable brand and its nationwide branch network with 24 million customers a week will be key assets in our drive to win and retain customers."

Post Office HomePhone customers will continue to receive their bills and all other customer support from the Post Office under the new agreement with BT Wholesale. The Post Office will also continue to compete fully for customers against BT Retail - as well as many other rivals - in the marketplace.