O2 (UK)


Telefonica UK Limited, trading as O2 UK, is a British telecommunications services provider. It is the largest mobile network in the United Kingdom, with approximately 23.2million subscribers.
Since 2021, O2 UK has formed a subsidiary of Virgin Media O2, a 50:50 joint venture between Telefónica and Liberty Global formed through the merger of their respective O2 UK and Virgin Media businesses.
The network was launched in 1985 as Cellnet, a joint venture between British Telecom and Securicor, and later rebranded BT Cellnet following BT's acquisition of Securicor's share. Cellnet was one of the two original cellular network operators in the UK, alongside Vodafone. In 2001, BT spun off its BT Wireless division as mmO2 plc, with the UK network adopting the O2 brand in 2002. O2 plc was acquired by Spanish telecommunications firm Telefónica in 2006.

History

Overview

The company was formed in 1983 as Telecom Securicor Cellular Radio Limited, a 60:40 joint venture between British Telecom and Securicor led by John Carrington. It launched the Cellnet network on 7 January 1985, six days after the launch of Vodafone. In 1999, BT acquired Securicor's share of Cellnet and the company was later rebranded as BT Cellnet. In June 2000, BT Cellnet launched the world's first commercial General Packet Radio Service service. The company, together with BT Group's mobile telecommunications businesses in Germany, Ireland and the Netherlands, was part of the BT Wireless division. This was spun off from the BT Group in 2002 to form a new holding company, mmO2 plc, which introduced the "O2" brand for the businesses. In 2005, mmO2 plc was renamed O2 plc.
O2 plc was purchased by the Spanish telecommunications company Telefónica in 2006 for £18 billion. Under the terms of the acquisition, Telefónica agreed to retain the "O2" brand and the company's UK headquarters. O2 plc was renamed Telefónica O2 Europe in 2007 and then Telefónica Europe plc in 2008, and became the holding company for Telefónica's operations in the UK.
In May 2020, Telefónica reached an agreement with Liberty Global to merge the company with Virgin Media. On 1 June 2021, O2 and Virgin Media formally merged to create Virgin Media O2 as a joint venture between Telefónica and Liberty Global.

1985 to 2005

Between 1985 and 1989, John Carrington was the CEO of British Telecom's Mobile Division and the chairman of Cellnet. It was during this period that Carrington launched Cellnet's first cellular service, following innovative development work by BT Spectrum, who built a chain of cells between London Heathrow and BT Tower in January 1985.
Cellnet was established in 1985 as a joint subsidiary of BTCR, British Telecom Cellular Radio, providing the engineering knowledge, and TSCR, Telecom Securicor Cellular Radio Limited, providing the financial investment, resulting in a 60:40 joint venture between British Telecommunications and Securicor.
The equipment used was primarily a Motorola system designed for the American Advanced Mobile Phone System and had to be adapted for the British system, Total Access Communication. The system was so unready that the initials that Motorola used to designate the network exchanges, EMX, became popularly known as 'European Motorola Experiment' and the exchanges had to be programmed in machine code loaded by tape. In the early days of the system, mobile calls cost £1 per minute.
After months of rumours and speculation, Peter Bonfield publicly announced on 27 July 1999 that BT had agreed to buy Securicor's 40 per cent share of Cellnet for £3.15 billion. Cellnet had five million customers at the time of its acquisition. The company was rebranded as BT Cellnet in 2000, and it became a part of BT Wireless, a group of companies owned by BT.
BT announced on 3 September 2001 that the BT Wireless business would be spun off from the main group as a newly listed holding company, mmO2 plc, operating under the "O2" brand. Shareholders approved the plan at an extraordinary general meeting on 23 October 2001. BT Cellnet relaunched as "O2" on 18 June 2002, along with other former BT subsidiaries: Esat Digifone in Ireland, Viag Interkom in Germany and Telfort Mobiel in the Netherlands.
The rebranding was supported by a European advertising campaign, which began on 16 April 2002, across all four countries, at a cost of £130 million. The main launch campaign ran from 18 June and was developed by Vallance Carruthers Coleman Priest, working alongside brand consultancy Lambie-Nairn, creators of the "O2" brand identity.
In March 2005, mmO2 restructured its shares and the company was relisted as O2 plc.

Telefónica acquisition

On 30 November 2005, O2 agreed to a takeover by Telefónica, a Spanish telecommunications company, for £17.7 billion in cash. It went through finally in 2006. According to the merger announcement, O2 retained its name and continued to be based in the United Kingdom, keeping both the brand and the management team. The merger became unconditional on 23 January 2006.
Following the acquisition of O2, Telefónica undertook a corporate organisational change that saw the merging of its fixed and mobile businesses in Spain, and the transfer of Telefónica's non-Spanish European telecommunications properties into the O2 brand. Thus, the Český Telecom and Eurotel operations in the Czech Republic as well as the Telefónica Deutschland business in Germany were brought under the control of O2, which retained its UK-registered public company status with its own board of directors and corporate structures and processes. Telefónica chose to keep its existing mobile phone operations in the rest of the world under the brand Movistar. This name is used in Spain and in most of the Latin American countries, operated by a separate management team.

Since 2007

On 15 July 2009, O2 entered the financial services industry with the launch of O2 Money, which was the first step in the process of incorporating financial services into mobile phones. Future plans included manufacturing Near Field Communication technology in mobile phones in the United Kingdom.
O2 and Vodafone signed a deal in June 2012 which will see the two companies 'pool' their network technology, creating a single national grid of 18,500 transmitter sites. Both networks will continue to carry their own independent mobile spectrum.

Sale attempts

On 24 November 2014, it was reported that BT were in talks to buy back O2, while at the same time BT confirmed that it was also in talks to buy EE. BT subsequently entered into exclusive talks with EE.
On 23 January 2015, Li Ka-shing, owner of Hutchison Whampoa and the Three network entered talks to buy O2 for up to £10.25bn. However, the move faced scrutiny from competition regulators as it would reduce the number of major operators in the UK, when combined with a potential purchase of EE by BT, from four to three. Hutchison Whampoa had previously acquired the O2 network from Telefónica in the Republic of Ireland, which it has since merged into Three. The combined network would have surpassed EE to create the largest mobile network in the UK.
The deal was subject to regulatory approval. The European Commission decided in December 2015 not to refer Hutchison's takeover of Telefónica's O2 business in the UK to the country's Competition and Markets Authority, which had asked to be allowed to investigate the planned acquisition, arguing that as the British competition regulator, it – and not the Commission – should have the right to rule on the transaction, which it argued 'threatens to affect significantly competition in the UK retail mobile and wholesale mobile markets', claiming that its investigation of the takeover would 'avoid duplication and fragmentation'. On 11 May 2016, the European Commission officially blocked the tie-up of O2 and Three, arguing that the merger would reduce consumer choice and lead to a higher cost of services.
In September 2016, Telefónica appointed a number of investment banks to sell the business to investors, ahead of a stock market flotation.

Merger with Virgin Media

On 7 May 2020, it was announced that Telefónica had agreed to merge Telefonica UK with Liberty Global subsidiary Virgin Media, subject to approval, into a 50/50 joint venture. Subject to approval, the merger was slated for the middle of 2021. The merger was completed on 1 June 2021 with the newly merged company positioning itself as competition with BT.

Outages

In July 2012, O2 had to apologise to almost 8 million customers after a network switching subsystem failure led to a 24-hour blackout of the service across the UK and Ireland. The problem, which prevented a third of its customers' phones registering on the network, also affected customers of MVNO networks Tesco Mobile and Giffgaff. To apologise for this, O2 announced that it would be giving hundreds of thousands of its customers compensation for the issue. Pay monthly customers received a 10 per cent discount on their bill whereas Pay As You Go users received a 10 per cent refund on their first top up in September.
On 6 December 2018, a major disruption to the O2 network, caused by faulty software, left up to 32 million users without access to data services for up to 24 hours. During the outage, some voice and text services suffered from congestion.

Network

BT Cellnet launched the world's first GPRS network on 22 June 2000, although GPRS-enabled devices were uncommon at that time.
O2 publicly announced on 15 December 2009 that it had successfully demonstrated a 4G connection using LTE technology installed in six masts in Slough. The technology, which was supplied by Huawei, achieved a peak downlink rate of 150 Mbps.
In January 2012, the company announced plans to provide free internet to millions of residents and visitors in central London, by launching Europe's largest free Wi-Fi zone, along with free Wi-Fi access for anyone on any network in and around every O2 retail store.
On 20 February 2013, Ofcom announced that O2 had been awarded spectrum in the 800 MHz band for 4G LTE coverage, bidding around £550 million for the spectrum. This spectrum came with a coverage obligation from Ofcom, and O2 is obliged to provide a mobile broadband service for indoor reception to at least 98 per cent of the UK population and at least 95 per cent of the population of each of the UK nations – England, Northern Ireland, Scotland and Wales – by the end of 2017 at the latest. The 4G LTE service became available to customers in London, Leeds and Bradford on 29 August 2013, and expanded to a further ten cities by the end of the year.
On 27 March 2017, following the release of iOS 10.3, O2 launched VoLTE and WiFi Calling for iPhone 7 and iPhone 7 Plus users, and stated more devices would be eligible at a later date. The facility was later extended to other makes and models of mobile phone.
FrequencyBandProtocolClass
900 MHzGSM/GPRS/EDGE2G
900 MHz8UMTS/HSDPA/HSPA+/DC-HSPA+3G
2,100 MHz1UMTS/HSDPA/HSPA+/DC-HSPA+3G
700 MHz28LTE/LTE Advanced4G/4G+
800 MHz20LTE/LTE Advanced4G/4G+
900 MHz8LTE/LTE Advanced4G/4G+
1,800 MHz3LTE/LTE Advanced4G/4G+
2,100 MHz1LTE/LTE Advanced4G/4G+
2,300 MHz40TD-LTE4G/4G+
2,600 MHz38TD-LTE4G/4G+
700 MHzn285G NR5G
900 MHzn85G NR5G
2,100 MHzn15G NR5G
3,500 MHzn785G NR5G