I've just switched my iPhone back on, and surprise surprise: the signal is back!
I was told twice, during my conversations with O2's CS, that it would be impossible to
cancel the contract SIM card deactivation, once the process was started, and also to
reactivate the contract SIM card once it was deactivated.
Things can be done, one just need to have the skills, knowledge and willingness to do them.
And, I kind of think this wouldn't have happened, hadn't I written in this forum. Thanks.
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To tell the truth, O2's CS representatives, despite sometimes not knowing things they should know, or giving contradictory answers between them, have always been extremely kind.
Also, in the past I have been twice swiftly offered refunds for wrong charges, without having to insist too much. Spot on, although it'd have been even better if they didn't charge me wrongly in the first place, causing me to spend time phoning their customer support.
In this instance I've been offered a 10£ refund for these troubles: looking forward to it.
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Thanks very much to O2's CS for finally solving the problem.