Staff Reporter

The only place we are not selling in the High Street is Vodafone shops We have a pretty comprehensive presence in the High Street and a limited reach through the (Cont P2) specialists. We will let things bed down and get it working optimally. Woolworths will be selling our products in the next four weeks. There has been some to-ing and fro-ing over dates but it will happen shortly. Among the self-select retailers we are where we need to be.

Woolworths is clearly a major High Street name. They are pretty important in the Christmas gift market and enjoy a huge footfall. Woolworths has shown a commitment and desire to play a long-term role in mobile phones.

They have been a major player in sales of pre-pay phones which is the area we are predominantly competing in. We had to be within the big hitters of the pre-pay world. We will constantly review the situation and other names may come into the equation later on said Hutchinson (see P34).

PT Distribution chief executive Tim Radford told Mobile News that people would be offered jobs at

Project Telecom where possible.

There has been a huge squeeze on pre-pay margins and we are addressing costs. The biggest cost is staff. We plan to reduce the head count from 140 to fewer than 100 within the next six months.

Right now we are undergoing a consultation process with staff. We are hoping to move some to our corporate business locally. We have 27 vacancies in that business. We have to follow the correct procedures and terminate peoples employment in one company and then re-employ them at the other. It is a (Cont P2) tough market. We turned over 240 million last year and made just 2.4 million profit.

PT Distribution supplies pre-pay handsets and top-up cards to 20000 retailers in the UK. Radford says the networks are squeezing the margins out of the distributors.

Our priority is to remain in profit. I cannot pretend things will get better because the networks have focused away from pre-pay.

To remain profitable we have to take action. There is a future in pre-pay. Seventy per cent of all mobile phones are pre-pay and demand continues for handsets and top-up cards concluded Radford.

Dixons said there would be no job losses from the firms 380 staff as a result of the deal. It also said that 2 million of the 31million paid for the company has been set aside as a golden handcuffs fund for senior managers.

We hope to create more jobs over time. Opportunities for the staff should increase rather than decrease Dixons added.

Brian Kennedy Genesiss founder and former sole shareholder gets 27million from the sale of the business plus another 2million if the company hits specified earnings targets.

The Link managing director Nick Wood said the acquisition of Genesis gives The Link and (Cont P2)

PC World access to Genesis direct sales team and thus the chance to increase sales to small businesses.

Genesis Communications has around 120000 business subscribers connected to Vodafone and O2 networks. The deal will also allow The Link to offer bespoke tariffs to small business customers.

Wood told Mobile News that

trials for small business areas within The Links stores would start this summer.

We will start a series of trials in the summer to find the best way to use our stores to generate business leads and close deals.

Genesis has a very successful direct sales force. Now we have to find a way to marry that with our retail outlets.

We would like to have some sort of business presence in all of our stores. It will be a challenge in some stores because they have limited floor space said Wood.

The Link will connect new business customers through Genesis while consumers will continue to be connected to Vodafone and O2 through The Links established service provider relationships.

This is not an attempt to become a consumer service provider. Genesis is built around high-value business connections.

It would be difficult to make a profit if we started connecting consumers because Genesis customer service operation is geared up for business customers.

As mobile and data technologies converge we will be in a better position to offer businesses a complete communications package added Wood.

This follows recent profit warnings and the resignation of former chief executive Darren Ridge.

KJCs corporate offices in Swaythling have been shut down as the first casualty of the review. The corporate sales team has been relocated to KJCs mail order centre at Lee-on-Solent in the interim. Meanwhile KJC is currently consulting with its staff at the Fareham distribution centre over the future of the premises and their jobs. A decision is expected within a month as to whether it will be closed and whether staff can be relocated.

We are reviewing the future of all the premises within the mobile business that are not mobile phone shops PNC marketing director Crispin Thomas told Mobile News.

Jobs are not necessarily under threat. We are carrying out a consultation with staff. It is possible staff may be relocated to other locations where we could run our distribution centre. We have shops that have lots of spare room for staff and other activities.

The review and Ridges departure have caused unrest among some KJC staff. They say Ridge has been made the scapegoat for PNCs poor financial performance. At least three staff from KJCs business division including national sales managers have left. However Thomas (Cont P2) scotched the claim saying: Darren Ridge was not a scapegoat. His decision to resign came after the company put out further profit warnings.

Some staff close to Darren Ridge have left the company because they felt they didnt want to work for different management said Crispin Thomas.

PNC recently appointed Ian Gray as its new chief executive.

Gray has had experience as chairman and chief executive with a variety of public and private companies.

In an exclusive interview with Mobile News Caudwell said:

I havent had an e-conversation with Hutchison. Ever. At all. Neither have I spoken with their representatives or with their representatives representatives to do with selling any of my businesses.

I dont know how the rumours started but I am astonished by their persistency. I have made so many denials. Despite that everybody thinks Ive sold.

The price quoted is a fair price. It is one I could live with. Though with the growth we are achieving in Phones 4U it very soon wont be fair because we are making the business more and more sophisticated by the day.

We have not been talking to anybody about selling our businesses. My objective all along is and always has been to grow Caudwell Group into the biggest company I can make it headed up by the best management team there is.

That means it is there for the long term. My ambition is that if I retire the management team in place will be strong enough to take the group forward.

Caudwell hinted that the Group may eventually go public.

And at that point we (Cont P2) might see a more traditional institutional management-type scenario come into play. Im trying to build a business thats here until eternity.

Were there any circumstances under which he would contemplate selling individual components of the Caudwell Group or the entire Group itself on a private basis?

My number one ambition is to build a lasting business. But there is something that overrides even that. In furthering that ambition I must never deplete shareholder value. I wont stick with any individual business just to grow Caudwell Group turnover he told Mobile News.

Browns successor is Ukko Lappalainen who is moving over from Nokias Networks customer business team in France. Brown took up the role as UK managing director from Isto Pankakoski in late 1999 after six years marketing the Nokia brand in Europe.

Brown will be looking after Club Nokia and all the services that it sends over the air to Nokia handsets.

Nokia recently announced slower sales performance in Q1 showing a seven per cent decrease in mobile phone sales in relation to the same period last year.

However Nokia predicts a five per cent rise in sales for Q2 and the second half of this year.

See Nokia story this page.

However the contract will be fairly restrictive and 20:20 will not be allowed to undercut distributors who are being supplied by other Orange distributors.

We are looking for incremental business following the consolidation in the market and we are giving ourselves the best opportunity to do this. We have ignored the Caudwell Group for too long said Orange sales director Stuart Henry.

The deal brings to a conclusion a long-running feud between Caudwell Group and Orange based on a mutual dislike between ex-Orange group sales director Gareth Jones and John Caudwell.

It was generally acknowledged throughout the industry that the two men couldnt stand one another.

Jones left Orange a year ago. He recently re-entered the mobile industry as a board director of online handset distributor Mloop (Mobile News April 18).

Cellphone Warehouse had over 25 stores. It is understood to have ceased trading after all its shops closed two weeks ago.

It is unconfirmed whether the company is now in the hands of liquidators. The extent of any debts and whether the 67 staff have been made redundant are also unclear.

The Cellphone Warehouses accounts for 2000 to 2001 show that chain made healthy profits of just under 1 million after tax and opened new branches within Asda supermarkets.

The Cellphone Warehouse also planned to expand its stores into mainland Europe in preparation for a public listing in 2003 in spite of the downturn.

Meanwhile calls to Miracles head office were unanswered and the companys trading offices have been closed for a number of days.

A number of directors resigned within the last few months. One ex-director told Mobile News he had been brought in to try and raise extra cash for the business but resigned when accountants told him it was futile.

Newcastle-based Cityphone has put a bid in and is currently carrying out due diligence. But bids from other suitors have also been made reports Bard Covington.

European Telecom declined to either confirm or deny that it was selling off its PCN business.

European Telecom chief David Mc Kinney told Mobile News in February that the company was always looking at different aspects of the business and how it can reduce costs.

It has been suspected for some time that European Telecom wanted to extricate itself from handset distribution to concentrate on (Cont P2) handset configuration and fulfilment for manufacturers. In January it signed a three-year deal to configure and distribute Philips handsets in Europe in a deal worth 300000.

The company has been looking to sell off all parts of the business not related to fulfilment and distribution of cellular equipment. In August last year it sold its 50 per cent stake in Global Telematics for 6 million.

Last September it shut down its Slough HQ and made 50 staff redundant in a bid to cut costs after running up losses of 27 million.

At the time of going to press European Telecoms share price was at an all-time low of 4p.

The stores to be closed are the smaller kiosk-sized ex-PocketPhone Shops. Around 100 shop staff will be affected. But it is not yet clear how many people will be made redundant. One 2 One (which will be officially renamed T-Mobile this week) hopes to relocate staff.

One 2 One closed 23 unprofitable stores last year.

Thus it has shut nearly a third of the 167 shops it purchased almost two years ago for 73 million from PocketPhone Shop founders Simon Jordan and Andrew Briggs. (Cont P2)

One 2 One denies this means that the purchase of PocketPhone Shop was a disaster. One 2 One external relations manager Patrick Barrow says a change in the market forced the closures.

The shops suited our requirements at the time of the purchase. Nothing is set in stone in business. We still have a clear retail strategy. We want the right stores in places where we will get the right people through the doors to buy our products and services.

The strategy is still on track and we will be opening bigger and better stores in due time. In some cases the stores were not attracting the customer profile we are aiming for.

Only last year One 2 One rebranded 136 PocketPhone Shops with joint One 2 One and T-Mobile branding and renamed the company One 2 One Retail Ltd. Earlier this year One 2 One retail managing director Andrew Fryatt quit following the decision to incorporate One 2 One Retail into the main business and run the shops directly.

PocketPhone Shop was also found to be the least favourite place people would go to buy a mobile phone in December last year according to the results of a survey commissioned by ICM Research.

Of the 1000 adults interviewed only 80 thought PocketPhone Shop would give the most honest advice. Nine per cent thought PPS would offer the best choice. Just six per cent thought PPS would have the best prices while 10 per cent thought PPS would have the most knowledgeable staff.