4500 jobs are to be shed worldwide as part of a restructuring programme to cut losses caused by the failure of an analogue cordless telephone business it purchased from Lucent. Vtech is suing Lucent for $170million claiming Lucent misrepresented facts relating to the purchase.

A spokesperson said

We are closing the R& D centre in line with the companys global consolidation strategy with 45 redundancies. UK sales and marketing staff will move to Farnborough. The closure will not affect continuing sales and marketing activity for VTech mobile products in the UK. R&D activity will move to (Cont P2) VTechs operation in Calgary Canada where we are developing mobile phones for the US market.

VTech sales and marketing director Robert Moran denies that redundancies of 34 R & D staff who developed VTechs GSM phones will affect the business.

Westcott who spent nine years at Ericsson has been offered an equity stake in the company.

He had only just been promoted to vice president of Northern Europe following the return from Singapore of marketing manager Alex Rodrigues who is now in charge of Ericssons mobile operations in the UK.

Keith will be joining us very shortly said Kondor founder Malcolm Bartlett who has also appointed Malcolm Benson as chief executive officer. Benson was formerly CEO of retail Software Company Matra Systems.

We are delighted to have secured two such strong candidates here with complementary skills.

Keith Westcott brings his tremendous experience and good standing in the industry while Malcolm Benson has extensive experience in distribution and sales.

These are two big hitters. We will get a good result from it.

Bartlett says Westcotts decision to leave Ericsson is a reflection on Kondors ambition rather than Ericssons troublesome year.

We are offering Keith some equity and it is an exciting change. He has the opportunity to help grow this company and enjoy the benefit of it. You dont get this opportunity in a more corporate environment. (Cont P2) Ericsson has an exciting future and its deal with Sony could revitalise the company.

Keiths decision to move is not due to any disenchantment with Ericsson. The important think for Kondor now is focus on our acquisition program and keep growing. Well be better equipped to do this with Keith Westcott and Malcolm Benson on board.

It is believed only 30 mainly-engineering staff remain to maintain the network.

Deloitte and Touche confirmed the layoffs saying: it has been necessary to downsize the Dolphin workforce.

But the administrators are continuing to deal with the day-to-day operations of the business with the support of the retained employees and the customers and suppliers of Dolphin.

While it is too early to state if and when a sale may be concluded every effort is being made to preserve the business.

Deloitte and Touche had set a deadline of September 14 for potential buyers to put in a bid for Dolphin UKs business and assets including its national network which remains operational. (Cont P2)

The deadline passed with no firm bids received. Dolphin passed into administration in August with debts estimated to be $1.2 billion.

Dolphin provided business TETRA communication services to 273500 subscribers across Europe.

The UK network was launched in August 1999 but by August 2001 had only attracted 76000 subscribers.

In November last year Dolphin admitted it had yet to secure financing needed to fulfil its 2001 investment plans.

In December the company announced it required a further $700 million of funding to carry out its plans to rollout new networks second generation handsets and maintain services over the network.

The company ran up huge losses caused by rolling out and launching the network subsidies on handsets and marketing spend. It covered 90 per cent of the UK population.

The service which was introduced to key dealers at a low-key trade launch in January has now been shelved because of adverse conditions on the telecoms market.

The decision is a blow for Caudwells distribution arm 20:20 Logistics which won the contract to source and package SIMs and handsets for the

OnStar service and deal with all admin dealer training and trade customer service.

One 2 One would have been the partner network.

An OnStar spokesperson confirmed the service had been shelved but declined to give any factual details.

A spokesman for 20:20 Logistics said:

We were appointed to look after product distribution sales and dealer support for General Motors virtual network in the UK and it is very disappointing to hear that the launch hasbeen delayed. Under the current market conditions however we fully understand this decision and now look forward to working on the OnStar project in the future when the time is right.

As well as being a mobile phone voice service the plan for OnStar was for a personalised web portal that learned the personal lifestyle preferences of its users and could act as a 24-hour virtual assistant.

The service would have been accessed from mobile phones PCs special in-car terminals (likely to be fitted to GM vehicles) and fixed lines to a customer service call centre.

In the USA OnStar offers GM vehicle owners GPS location and recovery telematics services such as remote diagnostics remote door unlocking and automatic notofication when an airbag is triggered.

A row has broken out between South Wales-based dealership EHD Telecom and Burton-on-Trent Orange distributor Mainline over 20000 in unpaid commissions.

EHD claims Mainline is refusing to pay them commissions due for connecting customers to Orange.

However Mainline says it is not happy with the quality of EHDs connected customers and wants to see copies of customers proof of address and IDs before it will release the money. Mainline has also terminated EHDs dealer agreement.

Mainline managing director Andrew Boden told Mobile News:

Mainline has chosen not to continue to do business with EHD telecom on the basis of subscriber quality.

We will pay the balance of any money owed once all unpaid stock is returned and we have received copies of customer proof of ID and address as stated in our trading terms.

We have received a statutory demand from EHD. These have been passed to our solicitors. Unless we see the documents requested we will hold commissions until the (Cont P2) claw-back period of six months has expired. We have tried to be reasonable. We have offered to pay EHD for the time and cost to produce copies of the documents we require. But it has fallen on deaf ears said Boden.

EHD managing director Eileen Davis claims Boden either does not want to pay or is unable to. She told Mobile News:

We have served Mainline with documents relating to the insolvency act for non-payment of around 7000. The total figure owed to us by Mainline is between 20000 to 25000.

We will issue documents over the remaining amount. Andrew Boden has not been able to agree payment terms with me. I dont know if he cant pay or wont pay.

There is an open door for Mainline to settle up. It is now down to the courts to decide payment terms.

Mainline only terminated our trading agreement after receiving the demands. We have nothing to hide. Our documentation is open for Mainline to see.

Joint administrative receiver Neil Geddes of Manchester-based accountancy firm Levy Gee said:

It is unlikely that the company will be resurrected in its current form. I could not rule out some of the staff being offered alternative posts elsewhere but again I believe that is unlikely.

We have received financial offers for certain parts of the business. I hope to be in the position to accept offers for those areas of the business we are looking to sell within the next few days.

Geddes said that it was too early to say whether the executive directors of The Phone People would face statutory investigation over the millions of pounds of losses.

No significant impropriety on the part of the executive directors has been brought to my notice as yet. The industry is undergoing significant structural change (Cont P2) and it appears that the company failed to deal quickly enough with the operational issues inherited from its predecessor.

It is disappointing that it has been necessary to discontinue trading operations. But there still remains the prospect that certain aspects of the business can be sold and we are looking for early expressions of interest.

Geddes is seeking offers for The Phone Peoples retail sites intellectual property and phone replacement business (see P14-P16).

Generation Telecom is tipped to be close to acquiring a Vodafone service provider for its subscriber base. Genesis Telecom and Global Crossing have been named by industry sources as the targets.

Nash will report to his old chief at Ericsson Generation Telecom managing director Keith Westcott. Nashs role will be to establish a new sales and marketing team and bring on new subscribers. (Cont P2)

Westcott told Mobile News:

I have worked with Barry Nash over the last eight years. I became aware that he was being made redundant at Ericsson and was keen to secure him to Generation Telecoms management team (full story next issue).

The company connected mainly One 2 One handsets and airtime through stores in Clapham Tooting Streatham Camberwell and Maidstone. It went into liquidation on December 21 last year. North London-based insolvency specialist R. Valentine & Co is the appointed liquidator.

NatWest Bank and (Cont P2)

One 2 One are understood to be the main creditors. It appears falling sales and squeezed margins forced the company out of business. In the year ending December 1999 turnover fell from 6.5 million to 2.5 million while profits fell from 36800 to 9062. These figures fell further as sales within the industry slowed throughout 2001.

In July 2000 the company changed its retail trading name from World of Accessories to Mobile Phone House saying the brand was confusing to customers. It retained the World of Accessories name for its own branded accessories.

This follows the suspension of a national sales manager and a dealer manager late last year (Mobile News November 12).

A third employee is being investigated in relation to the misappropriation of the companys funds said an Orange spokesperson.

Orange takes these allegations very seriously and is conducting a full investigation.

It is believed the national sales manager and dealer managers were involved in authorising irregular connections and marketing funds to two Rocom dealers that have since gone in to liquidation (Mobile News November 26).

Rocom is still disputing a 1 million clawback claim from Orange over the irregular connections made through Newcastle-based ITS and Wales-based Select Communications because it alleges certain Orange employees authorised the connections.

At the time Rocom chairman Bob Old officially declined to implicate the suspended individuals.

South London-based One 2 One dealer Mobile Phone House formerly known as World of Accessories and Fastgold Digital Telecom has folded with the closure of all its stores.

The company connected mainly One 2 One handsets and airtime through stores in Clapham Tooting Streatham Camberwell and Maidstone. It went into liquidation on December 21 last year. North London-based insolvency specialist R. Valentine & Co is the appointed liquidator.

NatWest Bank and One 2 One are understood to be the main creditors. It appears falling sales and squeezed margins forced the company out of business. In the year ending December 1999 turnover fell from 6.5 million to 2.5 million while profits fell from 36800 to 9062. These figures fell further as sales within the industry slowed throughout 2001.

In July 2000 the company changed its retail trading name from World of Accessories to Mobile Phone House saying the brand was confusing to customers. It retained the World of Accessories name for its own branded accessories.

A company with a Euro-centric name doesnt appear to be focused on the UK said Euro Cellular chairman and chief executive Win Donaldson.

Thats why Euro Cellular decided to start afresh in the UK with a new company. We sell more internationally than in the UK.

In the UK we have been selling well through non-traditional channels. We were never that desperate to move huge volumes in the UK if that meant offering people silly credit terms.

We didnt want to buy that sort of business. Now the market has changed and we see an opportunity. The company is looking ahead at 3G and we are looking at the level of service we need to offer in readiness for it.

M-Fusion sales director Chris Savva promised next-day deliveries a freephone number and a turnaround time for enquiries of 30 minutes.