Carphone Warehouse: More Woes
There was a lot of positive publicity in the City and generally in the national press for Carphone Warehouse with the announcement that Vodafone was allowing Carphone Warehouse to perform upgrades.
However, in the trade press a completely differently story is evolving:
1. Carphone upgrades are only 15% of the old business and there is no chance that Vodafone go back on the exclusive relationship with Phones4U. Phones4U has delivered exceptionally high volumes of Vodafone contract sales in recent weeks.
2. Carphone is really struggling to sell the Cath Kidston range.
3. Phones 4U are about to start selling “independent” broadband
4. Both Vodafone and Orange are putting the pressure on their store staff to sell more. Although, it is reported as a negative story, I believe long term this is the only way forward if the network operators are ever going to deliver decent volumes of direct sales and break the dependence on high indirect commissions.
I still believe there is huge pressure on Carphone to deliver value rather volume to the mobile operators and this will be the true indicator of its future position in the mobile value chain. It is also obvious that TalkTalk broadband is creating huge pressure with Carphone’s largest customers and that Carphone rivals are keen to exploit the problem. I also believe that Carphone is playing a really, really dangerous game with Vodafone, especially with Charles Dunstone comments being interpreted in the press as showing Vodafone are fools. I suspect Vodafone might be looking at the value that the Hugh Symons distribution arm of Carphone is bringing to Vodafone with a microscope. People in the trade are already gossiping that Vodafone will axe Hugh Symons soon and this would be a huge blow for Carphone.
However, in the trade press a completely differently story is evolving:
1. Carphone upgrades are only 15% of the old business and there is no chance that Vodafone go back on the exclusive relationship with Phones4U. Phones4U has delivered exceptionally high volumes of Vodafone contract sales in recent weeks.
2. Carphone is really struggling to sell the Cath Kidston range.
3. Phones 4U are about to start selling “independent” broadband
4. Both Vodafone and Orange are putting the pressure on their store staff to sell more. Although, it is reported as a negative story, I believe long term this is the only way forward if the network operators are ever going to deliver decent volumes of direct sales and break the dependence on high indirect commissions.
I still believe there is huge pressure on Carphone to deliver value rather volume to the mobile operators and this will be the true indicator of its future position in the mobile value chain. It is also obvious that TalkTalk broadband is creating huge pressure with Carphone’s largest customers and that Carphone rivals are keen to exploit the problem. I also believe that Carphone is playing a really, really dangerous game with Vodafone, especially with Charles Dunstone comments being interpreted in the press as showing Vodafone are fools. I suspect Vodafone might be looking at the value that the Hugh Symons distribution arm of Carphone is bringing to Vodafone with a microscope. People in the trade are already gossiping that Vodafone will axe Hugh Symons soon and this would be a huge blow for Carphone.
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