12/3/2009 10:12:00 AM
Brightpoint may ditch Nokia b2b deal over tough targets
Brightpoint could ditch its b2b deal with Nokia unless the handset manufacturer offers better volume targets, according to sources.
The distributor has asked Nokia to lower its tough volume targets to reflect the declining UK market, particularly for high-end devices.
One distribution source told Mobile: ‘The contract has not been terminated; however, Nokia and Brightpoint are in discussions on how to go forward and any decision will be based on what is right for both parties. It won’t be a decision Nokia makes in isolation.’
Sources say Brightpoint became increasingly frustrated by the demands of its b2b contract with Nokia, signed in October 2008.
The firm cannot meet Nokia’s terms without compromising deals with other clients, say sources. Brightpoint’s b2b clients also include HTC and RIM.
One industry source said: ‘Nokia wants a certain volume; its targets are only achievable by trading Nokia’s kit alone. But Brightpoint has more than Nokia’s deal to consider.’
Observers say Nokia has unrealistic expectations of its distributors. One said: ‘The size of the b2b market is nowhere near as big as Nokia thought it was. They don’t have the first idea where their kit goes, giving them a false impression of the size of the market.’
Brightpoint is a relative newcomer to the UK market, which rivals say is its Achilles heel.
One distributor said: ‘Brightpoint has no mature UK base, which makes it even harder for it to meet tough targets in a contracting market.’
Both Nokia and Brightpoint were unavailable for comment.