EE threatens to leave Carphone Warehouse and Phones4U

Oliver Smith
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BRITAIN’S biggest mobile operator EE is conducting a review of its sales through Carphone Warehouse and Phones4U, which could see it pull out of one or both retailers.

The results of the review are expected within three weeks, and the decision could threaten Carphone’s £3.6bn merger with Dixons if EE pulls its phones from sale.

Carphone Warehouse and Phones4U position themselves as a place for consumers to compare mobile deals across a number of operators – something that requires the support of a number of different networks.

“We announced a review of our distribution strategy a few months ago and this process is ongoing, with discussions continuing with all relevant parties, including Carphone Warehouse, who are a long-standing and important partner,” said EE.

Operators have been placing more emphasis on direct sales to consumers recently. Three pulled out of Carphone and Phones4U in 2013, while Vodafone will splash out £100m on opening 150 new retail stores over the next year placing more focus on its direct sales.

“We work closely with all the major operators on long-term contracts which align our interests and provide valuable incremental business,” Carphone said. “The proposed merger with Dixons creates the opportunity for significant new value and we’re in conversations with all the major operators on how we can mutually make the most of this opportunity.”

The recently-announced Carphone Warehouse and Dixons merger is said to have triggered talks with all operators who currently have relationships with Carphone as they look to negotiate new terms with the Dixons Carphone group. EE’s existing contract with Carphone is understood to last until Spring 2016.

Phones4U could be hit hardest if EE decides to pull support, as Vodafone would be the only major operator left.

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