His comments followed a move by 66 MPs who have backed an Early Day Motion in the House of Commons calling for the statutory barring of incoming calls to mobile phone numbers on prostitutes calling cards placed illegally in phone boxes.

The MPs expressed disappointment at the continued inaction of mobile phone operators in implementing this policy.

Mobile phone companies are completely neglecting their social duty to do something about this issue Malthouse said.

There are 12 pages in Vodafones annual report about corporate social responsibility. If people knew what Vodafone is doing and how its behaving over this issue I dont think it would be quite so popular. People would see through that social responsibility and see it as rank hypocrisy.

Vodafone was unmoved and issued a statement in response:

The investigation of an alleged breach of the law is the proper realm of the qualified authorities.

If anyone is aware of illegal activity we would recommend that they report such matters to the police so that they can be investigated appropriately.

We do not wish to set a precedent under which we might be expected to take independent action against segments of our customer base in response to a different perceived social nuisance. To do otherwise is not the legitimate role of a telecommunications operator.

O2 could break ranks with the other mobile operators which have so far remained adamant that such action does not fall into their remit as communications providers.

In a statement O2 said:

We are willing to conduct a trial of barring incoming calls to mobile numbers advertised on prostitutes cards placed in phone boxes.

This however would be subject to certain reservations being satisfactorily addressed. Such a trial would also need the participation of the police and approval from OfCom.

See main feature page 28

The network has written to service providers apologising for delays. Dealers have complained of ongoing frustration when trying to connect port or migrate customers.

They say the situation has caused intermittent problems with connections which take double the usual time to put through.

From January 28 no connections could be put through for almost four days.

Naeem Khokhar managing director of Cambridge-based dealership Select Telecom said:

My connections team have been experiencing delays with

Vodafone. But the 96-hour problem caused headaches. Staff were chasing deals that should have already gone through.

Gareth Penman of Liverpool-based Voice Telecom was not affected by the four-day problem. but he complains of other delays with Vodafones systems.

He added:.

With Vodafones Sharetime tariffs we have to register an org.id to ensure that all the sharers get free calls.

That is supposed to take a day. In last few months its been taking about two weeks. Some unregistered customers are paying for calls that should be free.

Some Vodafone service providers were blamed for the delays.

Keith Curran managing director of Yes Telecom said:

We were being blamed by our business partners for their connection delays. So I was really pleased when Vodafone wrote a letter and admitted its share of the blame.

A Vodafone spokesperson said:

The success of Perfect Fit for Business has increased demand on our provisioning systems.

This resulted in some system errors causing delays.

We are trying to minimise the impact. We are implementing a new system in the next couple of weeks.

The deal extends both companies reach. Commsense will continue to trade independently but will relocate to European Telecoms Waltham Abbey premises.

European Telecom MD John Drinkwater said the deal would enable Commsense to expand and European Telecom to sell more accessories.

European Telecom which has an annual turnover of 70 million hopes the deal will help it regain some of the ground lost when it ceased trading as a limited company three years ago.

As the market continues to mature dealers are making more demands of their distributors. They expect a full suite of services from their distributor. Its no longer acceptable for distributors not to be able to offer this said Drinkwater.

In response I decided to strengthen our portfolio of accessories. Our dealer base is asking us for general accessories and we now have that as well as good dealer support good stock and an excellent payment system.

There is some crossover in our dealer bases. But both companies will get access to larger bases because of this. So there is a natural opportunity for us there.

He added that the main reason for the deal was the expansion of both companies.

We are not actively seeking other acquisitions at present. We will continue to grow organically. But every opportunity should be looked at. In this case the synergies were so clear that it would have been foolish not to go ahead.

Commsense MD Barry Moores added: We needed to get bigger and we couldnt do that at our premises in Watford.

European Telecom has the infrastructure already in place at Waltham Abbey and it made sense to us when the offer came in.

Commsense will run on half strength while it moves to Waltham Abbey during the next two weeks.

Phone4U UK owner Abdul Heykali who also runs an independent dealership in south London reportedly wants 100000 for his website name phone4u.co.uk which has been trading for nearly five years.

Lawyers claimed in the High Court last week that Phone4U UK was receiving up to 500 e-mails each week from customers under the impression that they were dealing with the Caudwell Group-owned Phones 4U.

Phones 4U said: Its a trademark infringement case. Its not something were going to talk about.

Were keen not to give it any fuel. Its going on in court and it will stay in court.

Phone4U UK was unavailable for comment.

The trial was ongoing at the time of going to press.

In a letter Stansfeld said: Your account manager will ensure we share any relevant changes with you once we are in a position to communicate further but at this point in time our focus is very much on business as usual working with you to deliver another successful quarter.

Stansfeld also outlined measures to cut churn revealing that over the coming weeks O2 will spend more on simpler more compelling propositions that reward customer loyalty.

Over the next 12 months we will recruit around 1500 extra customer service advisers and set up a fourth UK call centre to increase service levels to our growing numbers of customers he said.

The True Tones include songs from Kylie Minogue Robbie Williams Blue and Joss Stone at 3.50 each.

The EMI tracks are available from Orange World and can be downloaded and remixed using Oranges Fireplayer service. News alerts text updates competitions and interviews with EMI artists will also be available to download.

Orange head of commercial relationships and entertainment Mark Ashford said:

The deal with EMI demonstrates our commitment to deliver high quality official content.

EMI Music UK digital media director Danny Van Emden said:

The opportunities we have with Orange allow us to deliver music content direct from our artists in the shortest timeframe possible so that fans have the earliest access to official products rather than cheap and poorly executed imitations.

Partnering with mobile phone companies is a natural progression from our recent web-based deals and puts a wide array of music content into the hands of our consumers.

Dan Biesler research director at Ovum said:

At least it has got it out of a mess. That is the only good thing to come of this. It isnt exactly a glorious exit. It isnt good news for Siemens that it failed to fix the handset unit having promised to do so.

Richard Windsor a telecoms analyst at Nomura remarked: Its a lucky escape. Thats why its such a good deal. Siemens has given BenQ the business debt free.

BenQ has acquired Siemens entire mobile phone business and its 6000 employees. BenQ has acquired the rights to the Siemens brand which it can use for five years.

The deal will be finalised at the end of September when 350 million ( 235 million) in losses will be carried through its accounts.

It is understood that of the losses 100 million are write-downs and 250 million will be paid to BenQ for investments in product harmonisation and patents. Siemens will also acquire a 2.5 per cent stake in BenQ for 50 million.

Windsor added: It will be up to BenQ to turn it around or else suffer the pain. The profitability of the company is down to BenQ as is the responsibility for the employees.

It is a much better deal for Siemens than it is for BenQ. The groups share price has gone up from 56 to 62.5. For Siemens that is a lot because it is a big conglomerate and its share price doesnt change that much. See p20.

The Mobile Industry Customer Satisfaction Survey carried out by Aura Corporation quizzed individuals on dozens of criteria such as their perception of network call quality customer service and handset ease of use.

Virgin Mobile merged as leader for customer service with 3 placed bottom among networks.

Samsung took the highest handset excellence rating with NEC coming last. O2 came top in retail satisfaction and product knowledge with Vodafone in bottom place.

A big surprise was a slump in The Carphone Warehouses standing in overall satisfaction.

On quality of reception 3 was rated significantly lower compared with all other networks. For overall satisfaction with networks 3 got an eight per cent ranking well behind Virgin Mobiles 18 per cent.

3 was also in last place on the perception of its customer helpline.

In 2004 we couldnt recruit enough 3 customers to give us a sample size we were comfortable with said Aura managing director Mike Trotman. As a result 3 was not included in the survey.

This time the number of 3 customers was far higher – and they were not satisfied. The network certainly has some problems to address. Loyalty quotients amongst 3 customers are on the floor.

He added that churn would be a massive issue for 3.

There might be a tide of enthusiasm at the moment on the back of its big marketing spend. But that tide will ebb as customers come to renew their contracts.

The survey says in many cases that as soon as 3s customers get a chance to leave they will be off.

3 responded: LG had a software problem with some versions of the LG 8120 handset which caused issues for some customers at the end of 2004 to early 2005.

This has been recognised and fixed. 3 continues to be the UKs leading 3G network winning several industry awards including best network and several awards for innovative services and tariffs.

3s customers continue to use 3s services more than customers on any other network with an ARPU of over 40 well above the industry average. 3s customers recognise our great value and leading range of mobile services.

See centre pages

Thats the view of Superintendent Eddie Thomson head of the National Mobile Phone Crime Unit (NMPCU).

The NMPCU in partnership with the Mobile Industry Crime Action Forum (MICAF) has been campaigning to get an amendment brought into the Mobile Telephones (Reprogramming) Act 2002 for some time.

A bill was proposed to go through but got waylaid because of the general election.

Now it is back appearing this time as a subsidiary to the forthcoming violent crime bill meaning it could become legislation in a matter of weeks rather than months.

The current act makes it punishable by up to five years imprisonment to reprogram offer to reprogram or be in possession of equipment that would facilitate the reprogramming of a handsets IMEI number.

However Thomson says that although the act has gone a long way in helping the NMPCU to target and catch perpetrators as it stands each arrest has involved a lengthy police sting to ensure a successful conviction.

At the moment just offering or agreeing to reprogram a phone is not enough to get a conviction – we have to prove that the person had the capability to do that.

So its a case that we have to actually catch them in the act. We want the offer to be the crime.

Thomson draws comparisons with the current laws on ticket touting and drugs.

It is an offence to sell or offer to sell tickets unless you are licensed. Therefore if an illegal tout offers you a ticket he can be convicted whether or not he even had a ticket for sale on him.

Those same laws apply with drugs – just the offer to supply drugs is unlawful and we would like to see the same thing happening with the doctoring of stolen mobile phones. That way we would not have to spend so long on each case.

So far the NMPCU has carried out more than 200 successful operations.

But Thomson is convinced that if the amendment was in place this number would be significantly higher.

Weve carried out more than 200 operations but they have been resource-intensive he explained.

The change would allow us to carry out even more operations with those same resources.

MICAF chief executive Jack Wraith added: The efforts of the NMPCU in tackling this sort of crime has had a very positive impact since it was set up.

We have seen that year-on-year mobile phone crime has been driven down.

But if we can get measures in place to mean that the offices are using their time as effectively as possible that can only mean further reductions in this area which is great for the entire industry.

This is something we have pushed for and we are glad to see that ministers accept the need for action and recognise that changes to the current legislation are necessary.

Images of the devices have already appeared on the Internet. The Zoe handset is expected to retail for around $200 ( 110) and the Ellen will be $350 according to reports carried on the Internet.

We havent announced any products with those names so I cant say a lot about them commented Sony Ericsson marketing manager Richard Dorman.

Nothing that weve launched to date has fitted into that profile but as we have seen in the past months and years the whole area of pricing is absolutely key to driving the market.

Dorman acknowledged that Sony Ericsson had responded to the huge growth in pre-pay by launching the K300 and J300 handsets.

It is an area in which we havent been strong to date because of the legacy of the joint-venture he conceded. But cost is key and we are continually looking at it.

He added: From the products we have announced to date it is clear what our strategy is going forward – imaging music and entertainment. We have now launched the K750 and the W800 will be available in August.

We are launching handsets at a lower price point already. The K300 and J300 are available on pre-pay now.

Previously our products have appeared at that price point only towards the end of their lifespan said Dorman.

Sony Ericsson will be launching a range of handsets and accessories in London on June 13.