T-Mobile has unveiled a new deal for the two thirds of UK mobile customers who payas-they-go rather than take out contract subscriptions.
The company claims it could cut the average cost of pre-pay calls and texts by between a quarter and one half - and it could increase pre-pay call and text volumes proportionately.
According to T-Mobile prepay provides an easy way to pick up a mobile phone, connect to a network and pay up-front for usage. It provides total budget control and is immensely popular. Twothirds of Britain's 68 million mobile customers are pre-pay.
Pre-pay however typically costs significantly more to use than contract subscriptions. This is one of the key reasons why average pre-pay customer usage is much lower.
T-Mobile believes that the cost of pre-pay is too much; that tariffs are too complex; and that a new "value map" is needed in the UK pre-pay market.
Following its success in changing the UK contract market with its Flext, U-Fix and Relax plans, T-Mobile is now changing the UK pre-pay market by launching a new range of only three simple pay-as-you-go plans, claiming they will radically alter value while recognising the different needs of different pre-pay customers.
Jim Hyde, managing director of T-Mobile UK, said: "Mobile is great, but it has to be affordable. Just as we have shaken up the contract market, today we're shaking up the pre-pay market.
"It's good for customers and it's good for us. It makes common sense and it makes economic sense to enable customers to use their phones without worrying about cost."
Phil Chapman, chief marketing officer of T-Mobile UK, added: "Our new pay-as-you-go plans don't just change pre-pay value. They recognise the different ways customers use their phones. And they give customers the freedom to switch with no penalty if they change the way they use their phones."