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As revealed last Friday on Top 10 Broadband, BT Wholesale and the Post Office have teamed up and signed a strategic agreement lasting four years and worth £750 million.

The agreement aims to expand the level of services the Post Office currently offers, and increase revenue though different avenues due to a loss in revenue in its traditional business.

The service should be available later this year and will be in conjunction with its existing home telephone service imaginatively called HomePhone. The broadband service will just be a re-branding of BT’s packages, but it is not yet confirmed whether the prices will stay the same or will differ.

The Post Office currently has 400,000 customers using its HomePhone service after it was launched in 2005 in conjunction with Cable & Wireless. However this will now be migrated to use BT’s services. So far the HomePhone service has not been a big success and the Post Office is a long way behind reaching its target of a million customers by the end of 2008.

Even with adding broadband services, the Post Office may still struggle to reach this target as the broadband market is highly competitive.

The managing Director of the Post Office, Alan Cook, seems very excited about the deal and said “We're delighted to have BT as a partner in a deal that gives a tremendous boost to the Post Office's determination to be one of the leading players in the telecoms market… The agreement provides the platform to enhance the Post Office's existing HomePhone service while offering customers some of the best deals in the market for both voice and internet broadband services."

But what makes the broadband service appealing to customers compared to other providers? Cook continues; “The Post Office's reputation for trust, its instantly recognisable brand and its nationwide branch network with 24 million customers a week will be key assets in our drive to win and retain customers”.

BT Wholesale also commented on the agreement, with Paul Reynolds the Chief Executive saying "This is a landmark agreement between two of the UK's leading and best established businesses. It will help to quickly establish the Post Office as a key player in an exciting, dynamic and ultra competitive market for broadband-based services.”

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