The multibillion-pound fund that launched Octopus Energy is exploring plans to launch a new mobile network in a move that could radically shake up Britain’s telecoms market.
Octopus Group, which helped to launch Britain’s biggest energy company a decade ago, is plotting an expansion into mobile services to challenge the four, soon to be three, companies that dominate the market.
The move suggests that Octopus is looking to replicate the success of its energy business, which has now overtaken British Gas as the country’s largest household supplier.
The new mobile virtual network operator (MVNO) would not build its own infrastructure but instead piggyback off one of the existing networks run by BT-owned EE, Virgin Media O2, Vodafone and Three.
The UK mobile market is awash with MVNOs, which often try to attract customers with cut-price deals or specialised offers such as data-focused contracts.
However, the majority of these brands are owned four major networks and it has been years since a player outside the telecoms industry has established a foothold in the market.
Superdrug set up its own mobile brand in 2018, while Asda and Tesco launched their mobile offerings in 2007 and 2003 respectively.
Octopus is understood to have approached at least one of the major networks through Fern Trading, a subsidiary that owns a handful of telecoms assets, to discuss a potential tie-up.
The Octopus discussions are believed to be linked to Y Corporation, a little-known mobile company owned by Fern Trading that has a wholesale agreement to use Three’s network.
Sources said Y Corp was now exploring opportunities to offer eSim-only contracts to both business customers and consumers.
The company appointed Adam Dunlop, the former TalkTalk consumer boss, as a director in January to lead the expansion.
Octopus Group was founded in 2000 by Simon Rogerson, Christopher Hulatt and Guy Myles after the trio quit their jobs in asset management in their early 20s.
The company is best known for launching Octopus Energy, which has grown from nothing in 2015 to serve almost 13m customers today. The provider has since been spun out of the group but it remains the largest external shareholder.
Octopus Group has since expanded into a number of different sectors through its investment arm, which manages funds of roughly £10bn for more than 63,000 investors.
It is unclear how the new mobile service will ultimately be branded. However, a new provider under the Octopus brand would allow the group to bundle more services together as it expands its operations across telecoms and utilities.
