Buckland claimed networks had no right to penalise a dealer for selling a phone if it wasnt subsequently connected.

He argued that networks were not applying the same terms and conditions to the independent dealer as they were to the retail multiples and supermarkets.

Said an Oftel spokesman:

It is the distributors who supply mobile phones to the retailers who may then choose to pass any clawback liability on to the retailers. This is a contractual matter between retailers and distributors. Oftel does not believe that there has been a breech of any of the networks respective licences. Obviously another tool which Oftel can use to investigate complaints is The Competition Act of 1998. However the agreements between the distributors and the retailers are vertical agreements for the purposes of the Act. They are thus excluded from Chapter One Prohibition by virtue of the Act.

Any claim under Consumer Contracts regulations would be dismissed because this legislation is not applicable to business contracts. The case has been closed by Oftel for the reasons we have outlined. If Mr Buckland wishes to pursue the matter further using any action he deems appropriate that is his prerogative. Theres no further action for Oftel to consider or for us to take.

Buckland responded:

Im disappointed with the ruling. I dont really think Oftel understood what we were saying. They are saying that a contractual (Cont P2) matter between the networks and a supplier is none of their business. Oftel doesnt care so long as the consumer is not affected. Whatever we argue about the consumers long-term interests their counter argument is to the effect that consumers are currently benefiting from the extremely high level of competition in the mobile marketplace so theres no case to answer Buckland said.

There has been no official hearing. No one has been called to give evidence on either side. Everything concerning the case has been handled by correspondence.

Buckland had been hoping that a favourable decision from Oftel would open the door for the matter to be considered by the Office of Fair Trading.

I dont know if Im going to bother pursuing clawback anymore. Theres a lot of work involved to take it a stage further and to approach the Office of Fair Trading directly.

Its a question of whether someone wants to plough through that quagmire to try to make a case. Unless someone wants to take the ball and run with it to the OFT the issue is to all intents and purposes dead.

However Im happy to hand over all the papers I have on the subject to anyone who wants to take the matter further.

The time for action on clawback has passed. Most of the industry is just going to accept whats happening. The independent dealer community is certainly going to be affected by the networks actions but as we have seen the four operators are not impinging at all on multiple retailers or supermarkets when it comes to claw back.

Over the past few years this market has changed out of all recognition. Dealers have to realise that in the eyes of the networks the independent route is no longer a valued route to market.

Buckland confirmed that none of the operators had commented to him about the situation far less discussed compromise. He believes that his efforts in respect of clawback have come to nought

All Ive managed to do is vent my frustration. I dont believe my work has done any good whatsoever. This is a green light for the networks to impose further restrictions constraints and conditions on the way they will permit independent dealers to do business with them

Buckland has just launched a company called Gr8 offering dealers the chance to earn money from sales of phone personalisation scratch cards .

Theres absolutely no truth in that rumour at all said One2One sales and distribution director John Barton.

Clearly we want to support in better and more inventive ways our existing solus channel partners. We are constantly looking at ways of improving the lot of exclusive dealers who bear our brand and I have had some conversations recently with a few of them along those lines. The climate is clearly difficult at the moment.

Getting close to and supporting those guys is very important to us. But we are not going to go mad and open 300 shops or anything like that number. Im not even sure that theres enough money in the market or the industry to support such a move anyway Barton told Mobile News.

Dealers who have heard the rumours of High Street retail expansion were not surprise at the speculation. Said one With the removal of the Loyalty Bonus something like this was inevitable.

Responded Barton:

Every loyalty or ongoing scheme in the marketplace has been withdrawn. We are not alone in doing so. Everyone starts off with the best intentions with the belief that their Loyalty Bonus will help retain customers. The truth is that such schemes do little or nothing to help reduce churn or address customer issues. Dealers just treat the Loyalty Bonus as a slice of margin. That being the case we decided to give a long period of notice that we will take the Loyalty Bonus away at the end of the year.

Some people have been less understanding than others. A lot of people who have railed against our decision to remove on-going are funnily enough those who dont actively support One 2 One at the moment.

It is a bit rich of them to complain that we are not playing fair. I am always looking at ways of supporting those partners who support us.

We are trying to put money back in though in different ways. We have put new commission levels on the tariffs and changed the prices of our handsets all of which means our making expenditure before the savings we will eventually make from discontinuing the Loyalty Bonus kick in.

Barton believes rumours of a High Street expansion could have come from private meetings One 2 One has had about ways to improve support for existing exclusive branded dealers.

That is just a continuation of a programme which will move on to another phase this year.

We are not planning a retail revolution but we do intend to continue our retail evolution.

Our report revealed Luton Trading Standards had traced electrically faulty chargers to a batch sold by Elite and European Telecoms accessory division TAG.

It was also alleged that Elite had been duped by its supplier with possibly forged EC Certificates of Conformity.

Elite has now fired its previous supplier and has signed a new contract with the company that supplies travel chargers for the Fone Range brand. Elite purchased the Fone Range brand and product range in November and says Fone Range travel chargers were not affected by this incident.

Elite says it has now revised its product testing procedures.

As well as the existing tests carried out by the manufacturer at source and by Elites in-house testing department all electrical accessories are now being tested separately by a British Standards Institution – appointed testing house followed by batch-tests carried out by an independent specialist company.

In taking these measures we have gone way beyond normal testing procedures said Elite managing director Ajay Gokani.

As well as the travel chargers every type of electrical accessory carrying the Elite and Fone Range brand will be subject to the four-stage check he said.

The previous supplier had erased the manufacturers name from the EC Conformance Certificate and inserted his own for reasons of commercial confidentiality.

Unfortunately that was taken to mean it was a forgery which we very much regret.

We have been working closely with the trading standards office concerned and they are entirely in agreement with the measures we have taken.

The safety of the user is paramount to us. We will take whatever steps are necessary to protect the reputation of both our customers and ourselves.

In going beyond the normal testing procedures we have demonstrated how seriously we take that responsibility said Gokani.

Fuller a former Newcastle United football pro has been in the telecoms business for more than 10 years. He ran Hutchison Cellular Services from 1991 and was on the launch team for Orange in 1994.

He left Orange last year and is now chief executive of Telewest Communications a role he will continue to carry out.

The company apparently told its call centre staff not to report for work the following day and literally pulled down the shutters at their main office in Glasgows Charles Street.

A neighbouring business reported some activity on February 7 following a visit from Trading Standards officers the premises did not reopen.

Marshall (25) is reported in the Sunday Mail to have quit his flat in the Dennistoun district in a hurry.

A former employee who worked in the customer care department told the newspaper; It has been a sheer nightmare having to tell lies to people every day. The phones were red hot with customers trying to get their money back but we were told just to keep putting them off.

A spokesman for Glasgow Trading Standards confirmed Millennium came to their attention when a considerable number of consumers complained that promised rebates under Millenniums Payback Scheme had not materialised.

The Department had also understood that up to 80 staff at the call centre in the Royston area of Glasgow had not been paid since Christmas.

Millennium is currently in administration but it is not clear whether it may be able to continue trading. At the time of going to press no Receiver had been appointed. Trading Standards noted that should the company cease to exist they would be unable to pursue the (Cont P2) matter further. Millenniums premises at Rosemount Workspace did not rely on passing street trade.

Its operation was geared towards direct telesales and telemarketing offering contract connections across all four networks.

Locals were also led to believe the deals offered were unbeatable and recommendations spread rapidly by word of mouth.

The company developed a scheme whereby it supplied contract mobile phones to customers on standard rental terms paid by direct debit to the appropriate network or service provider. Millennium then promised to rebate the cost of the line rental for each subsequent month at a variable rate. Increased calls meant a greater rebate.

Large volume users were effectively promised free line rental in exchange for high call usage.

Millennium promised it would make monthly repayments directly to their customers bank account. However it is not clear whether the company provided anyone with a rebate.

Customers complained they were misled and are now clamouring to terminate their contracts with third-party SPs.

Marshall was reported to have been preparing a new business venture called MiCell but was unavailable for comment.

A spokeswoman for Strathclyde Police explained that uniformed officers may have been present when Trading Standards called at Millenniums premises however no fraud enquiry is currently ongoing.

European Telecoms shares slumped to 24p last Thursday from a 12-month high of more than 6.

Hardy has handed over control of the beleaguered company to ex-Motorola business and strategic planning director David McKinney.

Hardy now becomes executive chairman of the company he founded in 1991.

European Telecom managing director John McFarnon and international managing director Colin Cartwright have resigned and are to leave the company at the end of April.

Financial advisors KPMG have been appointed to try and turn the company around. Measures have already begun with redundancies in the companys Slough headquarters.

A TAP spokesperson alleged that Chatternet had received goods and not paid for them but were claiming to have paid for the goods.

However Minesh Patel denied any involvement in the case.

I am not a director of Chatternet nor have I ever been. My only relationship with Chatternet is the fact they lease office and warehouse space from us and work within the same building as us. I am extremely annoyed. The row has boiled over to the extent that TAP had been blocking access to our offices and warehouse to try and force Chatternet to pay up. Our solicitors wrote to TAP threatening them with court action unless they cleared access to our premises or further attempts to prevent access to our property.

Mitesh Patel told Mobile News he has informed police and instructed his own solicitors to investigate the situation. He disagrees with TAPs claim that it has not received payment for the goods.

We have paid TAP 80000 for the goods the week before last and a further 10000 last week. Patel claims that Chatternet sold the handsets to Edgware-based wholesalers OneWorld Technology.

We have had cashflow problems because OneWorld have not paid us the full amount for these goods. We are seeking the full balance from OneWorld to enable us to pay up TAP said Mitesh Patel.

He also claimed that TAP has commissioned debt collectors to visit Oneworld to collect funds. But after seizing around 60000 from Oneworld the so called debt collectors themselves have disappeared with the cash leaving TAP in the lurch.

Said Patel:

Its not our fault that the debt collectors have done a runner. As far as we are concerned we only have a small amount to pay back TAP . We intend to do so when we receive the remaining funds from OneWorld. (Cont. P2).

OneWorld proprietor J Patel admitted that he had been paid a visit by two men claiming to be debt collectors. He claimed to not know who sent them.

Two guys entered my own dining room claiming they were here to collect outstanding debts. They prevented anyone from leaving the house or entering it. I felt very threatened and eventually handed over 75000 in cash. They also walked off with Jewellery and other items but Im not sure who they were from.

I asked TAP managing director Nasser Khan if he knew anything about the debt collectors. He refused to talk about it. I have already paid 80000 to Chatternet. Including the 70000 taken by debt collectors I only have another 40000 to pay which I intend to pay once the funds have cleared from another deal.

Last month Yes announced it had taken a 50 per cent equity stake in financially-troubled Phone People and issued optimistic statements that the two companies would be working closely together.

However on March 1 the deal had collapsed. Phone People joint managing director Amjad Baig had effectively terminated his involvement. Yes managing director Colin Jones (Cont. P2) admitted to

Mobile News his company had not realised the full extent of Phone Peoples battered finances. At the same time bailiffs had moved on several Phone People outlets to reclaim rent arrears.

Jones spent the weekend of March 3 trying to raise finance to salvage the deal approaching without success individuals and potential investors such as The Carphone Warehouse.

At the time of going to press (March 14) Jones was optimistic the venture would still proceed. He was still locked in talks with potential investors over the future of The Phone People venture and was unavailable for comment.

Yes Telecom commenced trading in the North West last September after receiving one of 33 licences from Vodafone as an airtime service provider.

This followed legal action by Prima Cellular Accessories over a debt of 10000. The Sheriffs men labelled goods to be seized within weeks should Fone Range continue to withhold payment from Prima.

Primas director Richard Ackroyd said action was taken after Fone Range failed to meet new dates for repayment after agreeing a repayment schedule.

Its a shame this had to happen said Ackroyd.

I wish that (Fone Range founders) Jay and Vimal (Pau) could see some sense and just pay the debt without us having to go through all this hassle. We are insured against the debt anyway. But after Fone Range agreed to pay the debt we had to wait and see whether they would deliver. Now that they have failed to meet the newly agreed repayment dates we had to take action said Ackroyd.

The Pau brothers sold off the Fone Range brand to Elite earlier this year to try and stabilise their ailing group of companies last year.

But worse could follow as other companies within the industry also decide to follow Primas example.

Dextra says it is owed a large sum of money by Fone Range. Dextra head of credit control Nick Ellis admitted that action may be taken shortly.

I dont think Sheriffs officers would be able to lay their hands on enough goods to cover what they owe us. We are in discussion as to what to do to recover the debt Ellis concluded.

Fone Range management was unavailable for comment.

The move follows One 2 Ones lead to raise the entry-level retail price of pre-pay mobile to 70 a fortnight ago.

Vodafones decision is now raising speculation that the other two networks Orange and BT- Cellnet will also shortly announce similar moves in the coming weeks.

Orange maintains it is reviewing the situation. BTCellnet said they too are reviewing the situation but had no announcement to make.

Network activation bonuses will be reduced by a further 12 in addition to a 6 reduction implemented on February 1.

Vodafone expects the price of its entry level Pay as you Talk packages to be around 70 in line with One 2 One.

The All in One mobile phone packages will be withdrawn from May.

Reaction to the move has been positive from the trade.

Data Select boss Peter Jones says it should have happened sooner.

It should have been done six months ago. It cuts out the non-traditional routes to market and puts an onus back into the lifeblood of this industry and the independent dealers. I agree that some dealers have been doing greater volumes as a result of pre-pay.

But they have suffered badly. I think what well see are more virtual network operations setting up shop and distribution companies along with retailers will have to re-focus.

But Jones argues that the networks need to invest some of the savings back into the trade if the initiative is to really work.

Id like to see the operators put some of the savings into greater development-training programs to create loyalty. It will be needed because there will start to be more content provision and the handsets will start to get more complicated. Dealers will need to be trained in those specialist areas said Jones.

Fone Logistics MD Ian Gillespie was equally enthusiastic at Vodafones decision.

The subsidy had to come out of pre-pay to stop box breaking. It has created a false market but hopefully now this decision will increase sales of contract phones he said.

Gillespie feels the move will have little if no negative effect on his business.

It wont affect our business negatively. We hardly do any pre-pay. It probably accounts for about one percent of our business because we dont focus on it and our sales people are dis-incentivised to sell it.

All the networks have done is made the box breakers a lot of money with pre-pay.

This needed to happen because everyone says it is the right thing to do but it takes brave men to do it first and stand by it.

In the coming months I expect to see a decrease in contract acquisition commissions too because the feedback said Gillespie.

Im getting from the networks suggestions theyll be more focused on revenue streams and customer retention rather than acquisition.

Carphone Warehouse marketing director Jonathan Hook is confident the decision wont have an adverse affect on sales.

Pre-pay has been great for customers but the balance is changing and the handset value has to be reflected because customers just dont understand just how much these mini computers cost.

People who want to get on to pre-pay will get on and raising the price from 20 to 60 or 70 is not an insurmountable price barrier. Im sure the networks will ensure that there is greater value in the box one way or the other so the customer doesnt lose out.