O2 UK is to launch a new MVNO in the country, dubbed as a ‘people-powered’ service. Known as ‘giffgaff’ (which apparently means ‘mutual giving’), the service will use O2’s network for back-end operations such as billing but rely on its community of customers to help answer technical or other problems and decide how the operation evolves. According to giffgaff’s website, the service will be up and running by Christmas and will offer one tariff for voice, text and 3G data. With no retail outlets, the operation is online only, and there are no long-term contracts. giffgaff will provide a SIM card, although not the mobile device.
The idea to base a network offering around an online store that will enable self-service and encourage interaction between customers is a new business model for O2. It aims to attract customers by rewarding users depending on how much involvement they have; it goes as far as to state that members “could get back up to 100 percent of your top-ups… You can keep the cash, pool it amongst other members, or donate it to charity – so you can yik, yak and give back.” Chief executive Mike Fairman (the giffgaff Gaffer, according to the company’s chatty, uncorporate blog) will head up the service. O2’s move comes as rival 3 UK today announced plans to boost its market share by using its own customers as agents to attract new users. The company will offer cashback rewards to people who successfully promote its prepay service to family and friends in a scheme known as ‘3 free agent.’ O2 and 3’s new programmes are part of a growing trend amongst operators to try and reduce costs by giving consumers a more active role in the operation of their businesses.