Vodafone may rue Carphone exclusion

He described Vodafone's decision to appoint Phones 4U as it sole UK monthly contract independent reseller as "very likely" to halt expansion of Vodafone's UK customerbase, according to the FT.

Reputedly, Phones 4U's promise to guarantee a percentage of its UK contract business to Vodafone isn't as foolish as Carphone Warehouse would have us believe. Phones 4U regularly signs up around 30,000 customers but only needs to provide Vodafone with a minimum of 27,000, according to the Sunday Telegraph.

Meanwhile the Sunday Times quotes Peter Erskine, CEO with Vodafone rival Oh DOS (O2) as saying that "Vodafone's withdrawal presented him with an opportunity to cut the commissions his company paid to CPW."

Significantly the Sunday Telegraph is saying that another Vodafone rival, 3 UK, is in talks with Phones 4U as well. The deal won't be an exclusive one but will enable Phones 4U to advice 3 UK on its product offerings.

3 UK's rate of customer loss ('churn') is widely held to be the UK's worst at around 38 per cent.

Vodafone is obviously placing a great deal of faith on the performance of its own High Street stores. As yet the squabble with Vodafone hasn't spread overseas where CPW still sells Vodafone to its German, Spanish, Dutch, Irish and Portuguese customers. µ