9/25/2008 10:32:00 AM
Carphone and Vodafone 'in talks' after two-year stand off
Senior executives at Carphone Warehouse and Vodafone are in discussions about a surprise return of the operator’s contracts at the retailer, Mobile understands.
Bosses at both companies have been in talks over the last four months about selling postpay contracts, and more specifically mobile broadband.
Vodafone needs consumer connections and is known to have been assessing its options as the exclusive tie-up with Phones 4u comes up for review.
A deal between the two companies is far from agreed and could yet collapse, but there is appetite from both sides. Both companies denied that a deal was imminent.
Vodafone is looking to increase its distribution presence as it tries to catch up with O2 on consumer connections, and will announce a new service ahead of Christmas that sources have described as ‘extremely exciting’.
Most critically, Vodafone wants to push ahead with mobile broadband and some senior individuals at Vodafone see Carphone as a key retail channel given its laptop strategy.
Meanwhile, Carphone wants to have a full complement of networks, especially as it takes on PC World in the laptop market.
Leaked figures claimed that Carphone pushed past the double digit milestone in the laptop market for the first time last week, taking 10%, while PC World has apparently lost 12% of its dominance of the laptop market.
Vodafone surprised the industry when it announced it would not be selling any contracts through Carphone, and opted for an exclusive deal with Phones 4u in October 2006. Carphone and Vodafone have maintained a relationship through selling prepay since then.
Carphone said at the time that it couldn’t protect its independence if it agreed to Vodafone’s terms to guarantee a fixed share of its total contracts, regardless of Vodafone’s competitiveness in the market at any point in time.
It was widely believed at the time that the relationship between the two companies broke down, with Vodafone sources citing an overly confrontational strategy from Carphone.
Some of the key individuals on both sides are either no longer at the company or in different parts of the business. It is believed a more cordial relationship now exists between the two companies.