O2 ends deal with P4U for subsidised handset connections

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Customers can continue to get upgrades, SIM-only deals and prepay on O2 through the retailer

O2 has terminated its agreement with Phones 4U to offer subsidies on handsets for new connections.

The decision means Phones 4U is not permitted to sell new O2 contracts with a device as part of a package.

O2 said it made the change following a review into the volume of business it does through its indirect sales channel.

Carphone Warehouse, which is understood to be O2’s larg- est retail partner for volume, has confirmed it has not been affected by the changes. Phones 4U will, however, continue to offer O2 SIM-only monthly contracts and prepay handsets.

Existing customers on an O2 contract with Phones 4U are unaffected by the changes and will be entitled to a new device at the time of upgrade.

The change comes less than a year since Phones 4U stopped selling Three connections, following a ‘mutual decision’ to terminate the agreement.

A spokesperson for O2 said: “We regularly review our retail distribution mix in order to get the optimum balance of sales through our own direct channels and indirect retail partners, giving customers the choice of where and who they shop with.

“Phones 4U remains a partner for us and will continue to offer O2 pay monthly SIM-only, upgrades and sell O2 Pay & Go handsets.”

A spokesperson for Phones 4U added: “We continue to have a strong relationship with O2. At times we vary our proposition in response to investment requirements from our partners.”

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