Post Office launches mobile phone network through EE

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The Post Office is launching a mobile phone network to challenge similar services offered by Tesco, Sainsbury's, Asda and the Co-op.

The new service will initially be sold through 50 Post Office branches and online from the autumn, followed by a nationwide rollout by the end of the year if it is a success. It will use the nation's largest network, EE, which underpins the T-mobile and Orange mobile phone brands.

"Launching our own mobile service, using EE's network, is a significant milestone in the Post Office's journey of change and a testament to our continuing efforts to offer more essential services for our customers," said Martin George, chief commercial officer at the Post Office.

The Post Office joins several other high-street brands in launching a mobile phone service, including the UK's three largest supermarkets and the Co-op. The UK has 24 "virtual" mobile phone providers, such as the Post Office, which each rely on EE, Vodafone, O2 or Three's mobile phone networks to carry the service.

"Our network of over 11,500 branches combined with our online, and call centre presence, gives us the perfect platform to become one of the most credible providers of mobile services in the market," George said. "We believe we are in an ideal position to offer a genuine alternative."

The Post Office's mobile move adds to the company's home phone and broadband service, which has around 500,000 customers and launched in 2007.

Since Post Office split from Royal Mail, the government-owned Post Office service is trying to define itself as a financial services provider offering foreign exchange, travel insurance, home and car insurance, mortgages and savings accounts.

In July the Post Office announced it would double the number of branches offering current accounts, which are offered in partnership with the Bank of Ireland, bringing the number to 186. That number will rise to 239 by the end of September.

Post Office profits fell to £53m in the first half of the financial year, down £8m on a year ago.