T-Mobile follows O2 and Orange's commission scheme

T-Mobile follows O2 and Orange's commission scheme

T- Mobile is working on the viability of a revenue share model for its dealers and distributors.

This would make T-Mobile the third out of the Big Five networks to adopt the commission scheme, following O2 and Orange.

A T-Mobile spokesperson said: ‘As part of the ongoing review of the indirect channel, we are considering other commission models, including revenue sharing. We believe this is the way the market is moving, but it’s business as usual for the moment.’

Meanwhile, 3 is understood to have not discussed ongoing commissions in any depth, and Vodafone sources have remained tight-lipped on plans.

Both 3 and Vodafone are believed to be looking for some short-term gains, capitalising on any disgruntled dealers and distributors that are uncomfortable with the ongoing model adopted by O2, Orange and now, possibly T-Mobile.

T-Mobile already uses an ongoing payment model for ‘Solo’ - its Sim-only rolling contract.

O2 started the ball rolling on 1 October with a system of ongoing payments to its indirect partners. The system provides an initial advance of cash, which is a percentage of 14 months’ worth of an average ARPU of £40. From month 15 there will be a monthly revenue share payment.

The model is designed to improve the quality of connections by mirroring customer loyalty with distributor and dealer payments.

Despite the initial cash advance, the feeling among dealers is that there may still be a problem with cashflow. One dealer said: ‘it’s difficult to see any positives; initial commission may not be enough for the handset. It means we will have to drop subsidies, putting us at a disadvantage to networks.’


Written by Mobile Today
Mobile Today

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