Staff Reporter

The Swindon service provider which has around 500000 subscribers was acquired by Vodafone last week as exclusively revealed in Mobile News (March 10).

Major shareholders managing director Nigel Bunter and chairman Ric Lee have gone. The companys new general manager is Tim Bean previously responsible for customer development at Vodafone. Bean also worked for Vodafone Retail when it was a separate service provider.

Vodafone director of customer management Joe McLoone said business as usual was very much the message coming from the network regarding its recent acquisition. McLoone assured dealers that there would be no immediate changes and hinted that some of the Cellular Operation packages might last beyond the May review.

His declaration will ease dealers fears. Cellular Operations gave generous commission terms and dealers were worried that this would change when Vodafone took over with its bespoke tariffs being scrapped. The terms offered by Vodafone Direct are significantly less appealing.

McLoone said Vodafone bought Cellular Operations to be closer to its customers.

He refused to rule out the network acquiring any future service providers. McLoone said there would be no changes at Cellular Operations.

We dont want to tamper with something that has been very successful. We arent going to make immediate changes before we have looked at the business in detail. We want the people there to feel they can make the same decisions as they did before he said.

Vodafone is not disclosing the price it paid for the company but an industry source guessed the network would have paid at least 100 for each of the 500000 subscribers which could have netted shareholders Bunter and Lee 25 million each. But a debt provision would have reduced that price.

Cellular Operations turned over 240 million in its last financial year and employs around 600. It lost 12.5 million last year on top of a cumulative loss of nearly 6 million so Vodafone will inherit cumulative losses of 18.5 million.

Vodafone picks up accounts such as Ford Jaguar and the RAC and inherits the firms 7 million headquarters with call centre warehouse and distributions facilities.

It must be hard for Nigel and Ric leaving something they have spent years building up said McLoone. Considering all the work they have done it was very important to keep looking after customers in the same way and create a smooth transition – which has gone very well because Nigel and Ric put a lot of thought into it.

Despite the admission that the industry is facing some very tough challenges Carphone Warehouse is to push ahead with an ambitious expansion plan that will see the number of stores rise from 480 to 550 in a bid to increase its overall market share.

As well as the store expansion the company is to more than double its budget for the training and development of branch managers.

A spokeswoman for the company commented:

We have announced that we are planning to open around 100 stores across the group this year. We have not broken down this figure but we are concentrating on the UK France and Spain. It is too early to say how the split will be made.

She added: The fact that we havent retracted this plan since our initial announcement is a good sign and shows the confidence we have in the market.

The company also outlined its first annual plan for new fixed-line service talktalk.

The target for the year ahead is 200000 customers. Achieving this goal would see the companys retail gross margin grow by five per cent.

Branch managers of the retailers smaller stores have had their quarterly bonus payments cut in half while managers at larger stores have seen their bonuses increase (Mobile News March 10).

Nick East of North East Communications in Elgin north Scotland set up www.boycottcaudwell.com after becoming tired of the way the group was carrying out business.

Two weeks after setting up the website he and the host company both received a letter from Eversheds saying the site was defamatory.

The letter added the tenor of the websites content is that Mr Caudwell and the Caudwell group of companies are untrustworthy and operate in a manner which is dishonest and unfair.

Eversheds gave East 24 hours to remove the website.

The site listed all the divisions addresses and contact numbers of the group as well as alternative companies to deal with.

It also ran links to negative stories about the group on sites such as BBC Watchdog which ran a report on 1000 complaints received against Caudwell airtime division Singlepoint.

At no stage did I write anything that was untrue. Before creating the website I took my time to avoid including anything that was libellous or untrue said East

East was motivated to produce the anti-Caudwell website after catching representatives from Caudwell retail arm Phones 4U handing out leaflets for its store directly outside his shop .

Other dealers had experienced the same sort of treatment so I knew I wasnt alone he said. 20:20 Logistics and Dextra heavily target the independent retailers for business. I thought it was awful that with one hand the Caudwell Group works with independent dealers and with the other it plans to hurt those very dealers who are its customers.

I didnt publicise the website. But in the two weeks that it was live we had nearly 1000 visitors.

East says that the website wasnt set up and operated with malice and that he just wanted to highlight what was going on.

The Caudwell Group declined to comment.

The range to be shown at CeBit includes the T610 (a 65000 colour-screen mobile phone with in-built digital camera) the T310 (colour-screen phone with a strong gaming edge) and the T606 and T608 – CDMA phones with mobile entertainment and imaging features as well as integrated Bluetooth.

Also on show was a flash accessory for the T610 (MPF-10) and a Bluetooth music hands-free device (HBM 30) as well as updates for the recently released P800 including a new grey-coloured handset and an online applications shop.

Sony Ericsson managing director UK and Ireland Philip Rambech said: With the T610 we offer a strong imaging phone which also has a sleek and lightweight design.

We have seen a great uptake of mobile imaging among consumers and we are now in a position to take this to the next level.

With the T310 we further strengthen our position in the MMS mass-market phone category. With these new products we are now able to put forth a strong offering to all aspects of the market.

Rambech said the T610 will be pitched at the same mid- to high price point targeted by the T68 on its release.

The T68i will remain on the market due to its popularity while the T310 will be at the affordable end of the market.

The basic voice and text T100 handset will target the mass-market entry-level area of the market.

The T310 which is available this month comes with the exclusive Tony Hawks Pro Skater game embedded in the handset with new levels available for download while the T610 comes with a ring tone composer. It should be on the market in the second quarter of the year.

The T610 moves us on from the T68. The flash attachment was something that our customers had pushed strongly for and the integrated camera gives customers all they could want in an imaging handset said Rambech.

Also trumpeted at the release was the joint ventures QuickShare concept an MMS-linked feature focusing on the ability to take and send messages quickly and simply.

(See Sharp End P50).

Its the company he previously snubbed to take the job at 20:20.

Whellams joined 20:20 barely weeks ago and was made associate sales director (Mobile News March 10) with responsibility for developing new business with the networks for the distributor.

He had been set to join Unique but opted for 20:20 after he was made an offer he couldnt refuse.

Unique Distribution confirmed last Wednesday that Whellams had in fact now joined Unique in time to join other Unique executives on the companys stand at CeBIT.

Whellams was made redundant from Trium in February when Mitsubishi pulled out of the UK. His last deal for Trium was to sell thousands of handsets to Unique.

The network has done a deal with

Zeppotron the comedy and entertainment arm of Endemol UK to provide comedy content for its third-generation mobile multi-media and communications services.

Zeppotron will be providing 3 with content including video audio text animation and graphics.

Uniting the two leading titles and two teams of experts will help What Mobile play to its strengths as the best consumer magazine in the market. The sale has been necessary because Ive moved to work for Motorola. But at least the pain of parting with What Mobile has been cushioned by knowing it is going to the best possible home. Its a fitting time to hand What Mobile over to where it can be nurtured and built upon.

When What Mobile started the most optimistic network forecasts were for eight million mobile phone users in the UK. Today there are 45 million users.

By the time the May issue comes out What Mobile will have tested measured and reviewed around 400 handsets.

The subsidy reduction is a result of the Competition Commissions decision to force networks to reduce interconnection rates. In January O2 said it would cut handset subsidy and delay 3G until 2004 because of the ruling.

But O2 sales director Mark Stansfeld denied the move was a reaction to cuts by O2s rivals.

This was not an easy decision. We take note of our competitors but we are focused on our own business. Decisions like this not only have an impact on our revenues but have implications for the channels.

A new business initiative called Best For Business is aimed at attracting high-value customers. It will launch on April with a national TV advertising campaign. A new Best For Business tariff replaces the Business First tariff.

The Best for Business tariff has a similar low monthly line rental but incorporates a 20 per cent discount on calls made to five UK fixed or mobile numbers.

Call Tagging will enable businesses to identify personal calls made on company mobiles. Bill Manager lets companies produce analyses of mobile phone spend.

O2s international traveller discount scheme is included so international GPRS usage can be shared between business users.

New tariff promotions include a 400-text bundle for 16. New customers connecting to selected O2 tariffs or purchasing O2s Calls & Text Bolt On tariff between April 1 2003 and June 30 2003 can claim an extra 100 minutes a month on some O2 tariffs for their first three months.

A lot of people are switching and churning between networks said Stansfeld. We are trying to keep customers for as long as possible. The re-aligning of our propositions and commissions aims to help everyone drive to that common goal.

Companies using GSM gateways offer consumers and businesses cheaper fixed-to-mobile call rates than BT. They use equipment that connects to the mobile phone network using a bank of up to 30 SIM cards.

A fixed-to-mobile call using a GSM gateway costs as little as 5p per minute as opposed to 14-16p per minute using BT plus the operators interconnection fee.

Orange claims some companies using GSM gateways are sucking up network capacity to the extent that ordinary customers cant make a call.

We have suspended the service of a GSM gateway supplier confirmed an Orange spokesperson.

The use of GSM gateways for very high volumes of calls from a static location can occasionally generate a variety of customer-affecting and operational problems for mobile customers and operators.

She added that Orange could not allow operators of GSM gateways on the Orange network to impair the quality and enjoyment of Orange services by its wider customer base.

Where we have evidence of customer-affecting problems operators of GSM gateways are in breach of their contract with Orange and we will take the necessary steps to resolve the problems in accordance with Orange UKs terms and conditions she said.

These measures include suspending gateway operators from the Orange network as would happen with any Orange customer who is in breach of the terms of their contract by causing a nuisance annoyance or inconvenience to our customer base or who impair the operation of our network she added.

We will continue to act in the best interests of our wider customer base.

This latest action comes weeks after the operators tabled their response to the Radiocommunications Agency (RA) consultation as to whether companies that run GSM gateways should be licensed or not.

The RA warned last summer that unlicensed GSM gateway equipment was illegal under the obscure 1949 Wireless Telegraphy Act. The RA is proposing to amend the law which came into force decades before mobile phone networks came into existence.

A decision on a change in the law is expected within weeks. The RA has said it wont prosecute anyone using GSM gateways until a decision is reached.

All five operators disagree with the view that public GSM gateways should be allowed to remain unlicensed citing network capacity problems as one of the reasons.

However companies in favour of GSM gateways argue that network operators are just angry to be losing out on fixed-to-mobile termination charges. Oftel is forcing operators to lower interconnection rates by 15 per cent by July and by a further 15 per cent each year for the next two years.

On the top floor of T-Mobiles luxurious waterfront offices in Hammersmith West London the networks great and good gathered. Among the executives were departing UK chief executive Harris Jones international chief executive Rene Obermann and international chief marketing officer Nikesh Arora assembled for what Obermann described as a special day in the history of T-Mobile.

With it being almost a year since the start of the rebranding exercise that saw T-Mobile replace One 2 One Obermann reflected on the networks successes before moving on to its plan for the immediate future. This according to Obermann is to push wide open the door to the mass market for T-Mobile multi-media.

Central to this is the Europe-wide expansion of the networks t-zone portals for multi-media (essentially T-Mobiles equivalent of the Vodafone Vizzavi and live! proposition).

From mid-April T-Mobile will offer a vastly improved multi-media services via t-zone portals to almost all its European customers. Already in January this year the network has attracted 2.2 million visitors to the portals.

At present the t-zones are updated around three times a day. Arora said that by April they will be updated around 30 times a day.

Other improvements will be to handset usability. From April everything will be ready to use from the box with the right price and the right usability said Arora.

Obermann added: The success of mobile data services depends not only on having exciting content and devices but offering the right tariffs.

According to Obermann the new tariff prices for GPRS will be up to 70 per cent cheaper than T-Mobiles current offering.

The tariffs have often been cited as an obstacle to the acceptance of data services. Although we saw things rather differently we have decided to sharply reduce the prices charged for using mobile data services making these extremely attractive for both consumers and business users.

In doing so we are pursuing our vision of making mobile multi-media applications available to as many people as possible at affordable prices.

The drive to stimulate mobile data is to be backed by a marketing campaign. This will kick-off in the first week of April. The campaign will feature new services an improved user experience and new handsets.

Arora highlighted five key elements identified by T-Mobile in the push to expand data services. These were usability new services partnerships mass-market tariffs and advertising activity.

To improve usability T-Mobile is introducing three new handsets. These will be enhanced with soft access keys to give users instant access to the t-zones – much like the Vodafone live! soft-keys. Later on users will be able to download their own icons and interfaces to create their own personal interface.

Arora says T-Mobile will only brand handsets if it adapts them to accept further services. The first handsets to meet this requirement will be introduced in April and are the Nokia 3650 the Samsung V200 and the Panasonic GD87. The network promises more handsets during the rest of the year.

Arora says new services will focus around three core components: infotainment; entertainment and messaging. T-Mobile also claims it will be first to market with video messaging while video downloads are also being added to the messaging service portfolio.

Another new service revolves around two new entertainment channels. The network announced partnerships with Universal Mobile the mobile subsidiary of Universal Music and MTV mobile. In both cases T-Mobile will use the agreements to offer musical content across the t-zone portals in major European markets. Users will be able to download the latest international and local polyphonic ring tones and logos as well as send songs as a greeting. In future users will be able to access video clips from Universal Mobile and view chart releases via MMS.

Other partnerships announced last week include Cambridge-based 3G LABS for customising handset interfaces and Research in Motion to bring the first consumer version of the highly successful BlackBerry device.

T-Mobile will use a 70 per cent reduction in GPRS prices to push data services. We believe our new pricing levels coupled with the exciting services we plan to offer will play a significant role in accelerating the adoption rates of mobile data said Obermann.

We are pricing mobile data for mass-market uptake and we are setting new standards for price transparency.

The price reductions are set to begin in Germany from mid-April and then roll out across Europe. Exact pricing of the new tariffs will be announced at CeBIT.

Arora concluded: The shaping of the mobile data market is a marathon not a sprint. We have developed critical mass in the past two years and we have been cautiously optimistic and above all sensible. Our partnership approach with a consumer-centred strategy will ensure we are the market makers and shapers. All pre-requisites are in place – the industry is ready for the acceleration in take-up of data services.