The pundits are painting a cheery picture of the mobile industry enjoying rude health while general retailers fall prey to a Christmas cold. Experts predict that sales of mobile products will reach an all-time high this Christmas, despite the chill felt from the housing market. It’s good to end the year on a high, but we should curb our enthusiasm a fraction to keep things in proportion.
As any accountant knows, figures can hide just as much as they reveal. Higher sales figures can hide the fact that some companies are enduring pain while others gain. Raw customer numbers can conceal the fact that revenue or customer growth is not the same as profit growth. Subsidised prepay customers are not as worthwhile as subsidised contract customers.
Nevertheless, operators are merrily using prepay to buy connections and compensate for a lack of contract sales. Business may be buoyant, but it is being bloated by subsidies. Generally speaking, the bigger retailers are doing better. They can command large volumes of sales, and are therefore the ones to do business with. Smaller retailers and dealers are struggling to hold their own, and some reveal that they are taking a cautious view and trimming back on expansion plans. That in turn is causing more sobriety than usual at this time of year among distributors.
Not that large specialist mobile retailers are having it all their own way. In this increasingly prepay-dominated scene, the likes of Argos are making ever bigger waves as they muscle in on the action. That said, it’s good the market is up, not down. There is interest and enthusiasm among consumers for the industry’s products and that’s a good way to end this year and prepare for the challenges of the next.