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October 14, 2015

Sainsbury’s cuts off Vodafone MVNO deal

News: Customers are advised to use credit before the service ends early next year.

By Alexander Sword

Sainsbury’s is ending its Mobile by Sainsbury’s MVNO from early next year.

The virtual network, running on infrastructure from Vodafone, will no longer be available from 15 January 2016.

Sainsbury’s said in a statement that Pay Monthly customers would be able to use the service until that date, whereas Pay As You Go customers can top up until 14 November. It advised customers to use all credit before that date.

The service reportedly attracted around 150,000 customers since it was launched in July 2013.

Kester Mann, Principal Analyst at CCS Insight, said that the decision could be motivated by a combination of the service not meeting expectations for customer take-up and a general strategic shift by Vodafone.

"There has been relatively low take-up in the 2-3 years Mobile by Sainsbury’s has been around," he said.

"There has been a change of sentiment at Vodafone in its attitude towards MVNOs. They are concerned about investing in their 4G networks and offer this to rivals at discounts. It undermines its business case for investment.

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"[Of the other operators], EE seems to be the most vocal about backtracking on MVNOs.

Mann gives examples of a Hungary MVNO venture with Tesco that Vodafone had abandoned, as well as ending its deal with BT Mobile.

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