Even though half year sales were up 30 million to 11 million the companys profits were hit by a collapse in its Far East markets as well as start-up losses from its associated joint venture company Global Telematics.

The City had been given a profits warning in October and the share price remained unchanged at around 1.22 (at time of writing).

The economic meltdown in the Far East has meant less than five per cent of European Telecoms income now comes from Asia-Pacific markets. But sales to mainland Europe more than doubled and now represent more than 67 per cent of turnover.

Sales from the accessories division TAG reached 4.1 million for the period under review.

Meanwhile European Telecom chairman and chief executive Warren hardy has split his job role. Ex-Spandex managing director Edmund Bruegger will be full-time chief executive. Bruegger has been a non-executive director of European Telecom since its flotation in June 1996.

Hardy who retains the role of executive chairman denied this move had been foisted upon him by the City

This was not requested or forced on me. Any inference that his (Brueggers) involvement has been forced on me would not be factual he told Mobile News.

Hardy says he will be dealing more at manufacturer and network level while Bruegger will concentrate on the day-to-day running of European Telecoms core distribution business setting and implementing strategies.

Also ex-Motorola and Philips executive Mike McTighe will join the European Telecom board as a non-executive director. McTighe formerly president and chief executive of Philips consumer communications and director of operations and general manager of Motorola will be involved with ET for about a day a month. McTighe was most recently in charge of the Philips/Lucent joint venture which fell apart after just a year (Mobile News November 2).

Hardy is also looking to appoint a new financial director following the resignation of Max Ashton who will be leaving the company at the end of January.

The new operational board of European Telecom will then comprise of Hardy Bruegger John McFarnon (group sales and marketing director) Lord Lang of Monkton (non-executive deputy chairman) Edward Belgeonne (managing director of Global Telematics) and the to-be-appointed financial director.

Leon Fitch (22) cloned his mobile to those of other subscribers and was arrested after a raid by Scotland Yard officers investigating other computer-related crime.

They raided Fitchs home in Levenshulme Manchester and found a computer programmed to clone other mobile numbers.

Prosecutor Timothy Spencer told Southwark Crown Court Fitch was working as a computer security advisor at the time of the raid in July last year. He cloned at least 50 worth of calls.

Fitch admitted nine (Cont P2) charges of being in breach of computer data protection and telecoms laws.

Judge Bathurst-Norman told Fitch a custodial sentence had been considered because offences of this kind cause a lot of people a lot of trouble and worry.

He warned Fitch:

If you ever commit an offence like this again you will be sent to prison.

The FCS have confirmed that the three networks will not be renewing their respective memberships in 1999. Cellnet alone was paying 19000 membership as a network and 15000 as a service provider.

However all four network operators will continue to support the FCS Crime Prevention Scheme which Mobile News understands is to be spun-off as a seperate audited and funded company.

Cellnet which has invested 200000 in the Crime Prevention Scheme has transformed its trade association loyalty to the Federation of Electronics Industries.

Because we are now a member of the FEI we didnt feel the need to be a member of two trade associations said Cellnet corporate affairs manager William Ostrom.

A statement from the FCS said:

The FCS has been extremely successful in representing the UK mobile communications industry for more than 16 years and expects to continue that success through its strong membership representation of the cellular service providers including Vodafone-owned service providers mobile radio operators manufacturers handset and accessory distributors dealers and installers.

The FCS also supports other telecommunications interests.

The Carphone Warehouse is the biggest independent retailer of mobile phones with 12 per cent market share. To retain this position we need to increase our reach. This acquisition will help us do that he said.

Tandy is a good business with excellent infrastructure and a great deal of untapped potential. We now plan to build Tandy into a significant player.

Tandy will continue to trade as an independent organisation but with more focus on mobile communications. The combined group will have 450 stores in the UK and annual sales more than 350 million

The shares dropped from 2.15 to the low 1.40s and then recovered to 1.55 (at time of writing).

Weatherill was reporting on results for the six months ended October 2 and revealed pre-tax profits of 414000. Connections in the retail division increased 60 per cent and connections from the 29 branded JWE dealers increased 43 per cent.

Weatherill said the effect of pre-pay on the market in the long-term would be beneficial.

Pre-pay has widened the cellular market place and a new type of customer is coming to the market much earlier than they might otherwise have done so. As these customers become more sophisticated in their requirements so the opportunities for upgrades and higher margin services will increase.

However in the short term the scale and nature of the changes in the market were such that the network operators significantly under-estimated consumer demand.

Pre-Christmas retail volumes while 50 per cent ahead of last year were unable to make up for reduced margins arising from pre-pay business. Supply of pre-pay is improving. We remain cautious about the network operators ability to satisfy pre-pay demand in the early months of 1999. We continue to sell all pre-pay stock we receive.

This is a great milestone. We intend to stay at the forefront of developments offering the best in communications technology said Link managing director Trevor Bish-Jones.

Helstrip left Ora a week ago. Hanson who had maintained a financial stake in Ora since selling out last March is now interviewing within the industry for a permanent managing director.

He is expected to continue playing a crucial role in the business. An announcement about a full-time MD is expected within the next three to four weeks.

Ora staff are said to be delighted with Hansons return. Insiders say that Helstrips management style did not entirely fit with the companys previous culture under Hanson.

Hanson told Mobile News:

Tim was working on futuristic products and it was felt we should be more customer focused. Im back as interim MD to play a more active role in the business. Its reasonable to say wed lost some focus on our core business.

Ive been getting more involved over last two to three months. Im pleased to be involved again. The reception Ive had has been very encouraging.

Hanson admitted that Ora had lost market share at the dealer end of its portfolio.

But that has not been significant in turnover because weve grown our key accounts.

Hanson also agreed that it was highly unusual for a management team that had raised such a colossal amount of money to acquire a company to have disbanded within a year.

These things happen. Its a question of trying to make sure we meet customer requirements. Since Ive been away the routes to market have been changing. It has been a whole new ball game.

Motorola held its top position in the analogue segment but Nokia posted the strongest growth in the total mobile telephone market with shipments increased 81.5 percent over the year before.

Nokia has based its product strategy on a few product platforms that have been adapted to all digital standards said Peter Richardson principal analyst for Dataquests Mobile Communications Worldwide program.

The companys product designs and feature sets were created from an intelligently conceived market segmentation plan that looked to consumer desire for inspiration not simply engineering ability. With 32.5 percent of mobile phone sales Western Europe was the top region in the world. The USA was second with 17.1 percent of sales followed by Japan with 16.5 percent of sales and the highest per capita level of sales for any country worldwide.

Worldwide sales of mobile telephone terminals to consumers reached 162.9 million units an increase of 51 percent over 1997 shipments according to Dataquest.

Digital mobile phone sales surpassed analogue phones in 1998 as digital accounted for 84.6 percent of total mobile phone sales.

We believe that 1998 was the year when data growth shifted up a gear in the UK said the MDAs chairman Mike Short.

From a base of one million the MDA is confident that with the right partnerships this UK customer total could exceed five million data and text customers within three years.