[3GScottishUser]

33 dealers hit in 3 cull


3 terminated another 33 dealers on Friday night in a spring-cleaning exercise, just weeks after the operator shifted its indirect focus to business connections.

The dealers were all connecting through 3's distributors and are understood to be a mixture of retail stores and distance sellers.

In a bulletin sent to distributors, 3's channel team said: 'In line with our continual drive towards quality business this year, and underlining our commitment to building a quality channel for us all, please find attached a list of terminated accounts that will no longer be able to trade with 3.'

The note added that 3 was continuing to watch some dealers closely. 'In addition to this, we are managing the strategy risk for several dealers, where we have identified a positive/negative quality trend in order to manage quality volume. We will continue to focus on supporting those dealers that provide quality business.'

The move further narrows the field for 3's distributors, which have seen 3 connections plummet as the operator tightens its trading terms and scales back its commissions. 'It's tough out here in distieland,' said one distribution boss.

The termination will leave some dealers with few trading options, as many are believed to have already been terminated by other operators.

However, the recent changes in 3's terms, including less support for handset returns and lower commissions, means that losing 3 may not be a major issue for some retailers, who have seen 3 connections drop sharply.

A 3 spokesman told Mobile: 'We're focused on attracting and retaining quality customers. Our terms and conditions are clear and anyone who doesn't abide by our conditions, or is not reaching our requirements, faces losing the right to trade with us.'

http://www.mobiletoday.co.uk/content/15854.asp?men=1&sub=2

[Hands0n]

Still getting the "wrong quality customers" huh? Soon, one may need to subscribe to a special "Quality Club" before they'll let you take out a contract.

I suppose it is a good thing that there are four other main networks and any number of MVNOs to choose from.

[3GScottishUser]

I wonder what the 'quality' of the customers attracted by £15 for 500 x/net mins per month for life is like? Does anyone think those buying that deal will be better for 3 than the folks who opted for the previous 1/2 price line rental and cashback schemes?

Whilst they will probably be more credit worthy and all will be paying by direct debit I doubt if the overall profit prospect at this low level will be much better.

Its a very tough market out there by the looks of things!

[Hands0n]

Is it just me who finds all of this "wrong quality customer" thing offensive in the extreme? It really and truly narks me :( , big time!



Verb 1. nark - cause annoyance in; disturb, especially by minor irritations; "Mosquitoes buzzing in my ear really bothers me"; "It irritates me that she never closes the door after she leaves"

http://www.thefreedictionary.com/narks



Edit: The other week 3's CS Sales called me to try and talk me back into one of them £15 a month thingies. I did at that time tell him that I could not contemplate trying their service because I couldn't evaluate the product without using it, and that their newest policy on "touch it and its yours" prevents me from doing that (he couldn't defend that position). I also asked him how I could tell whether or not I was the wrong type of customer for 3, seeing as their UK CEO was worried about attracting such poor quality customers. The silence was quite deafening as the poor lad tried to digest this little gem! Needless to say, I declined their very kind offer of roping me in for an 18 month stint with a refurbished Nokia 6280 or an LG U880.

[Ben]

Perhaps 'wrong quality dealer' would be more appropriate. A good dealer will connect legitimate customers onto tariffs that suite them. A bad dealer will connect customers depending on the commissions structure and push sales when customers are uncertain.

The problem is with the customer facing parts of the business, not the customers themselves.

[getti]

The thing is not everyone is like us and want the very latest phone with 100000000000 mins and 10000000 texts with unlimitef full web browsing.

Many people in the UK are on PAYG because they just want a cheap phone to use in case of emergancy situations or to keep in touch with friends and family. Now on average on PAYG you are looking at 35p a min x-network. So for 100 x-net mins on PAYG you are looking at £35 a month minimum.

What 3 are doing here is offering some great phones (The V3xx is free until Monday on this deal), plus there is the K800 + W850 for £49.99 on a really good cheap plan but getting great value.

Many people who topup around £10-£20 a month will take 3 up on this offer because you get a free phone (most are free) which is always nice, and there are no cashback schemes, all you get is a bill for £15 a month which you can pay as you wish. Ok the plan or phones might not be suitible for everyone, but look at that thread with the networks customer numbers. Millions of PAYG customers on other networks when for £15 a month you can get 500 x-net minutes plus have a new phone that has 3G technology.

Sorry... but to me that is just a bargain. If other networks want to only offer the more expencive deals to attract higher spending customers then let them i say, There are millions of people who just use a phone for calling in which case no other network can match the £15 deal from 3.

[Ben]

The thing is, most PAYG customers are on PAYG because they don't want/can't get a contract. They pay the (sometimes) more expensive prices because they have no choice. Even a cheap contract isn't going to attract somebody who only uses their phone for emergencies, has a bad credit rating or is under 18. That leaves, mostly, higher spending customers who are good for a lot more than £15 a month.

What 3 need is a gutsy, interesting PAYG product.

[getti]

Yeh i undestand where your coming from. Just from personal experiance in the store though I have had loads of people take up the £15 deal and when i ask what deal they have already, 90% of them say they are on PAYG because they did not want a contract due to the price... but they said £15 was a great offer.

[3GScottishUser]

3 had better hope that some of these £15/month customers spend some money on SMS/MMS and content or their ARPU will take a hammering!!

I'm not sure that low spending PAYG customers are a good prospect especially when you give them 500 x/net minutes and have to pay the termination costs to deliver calls to other networks! OK they get some ingress but that will soon be squeezed by Ofcom, so I suspect the £15/month deal is a quick fix landgrab.

This offer looks like a 'get new customers at all costs' effort and while its maybe a good prospect for low spending customers its a very dubious prospect in terms of increasing the company's worth!

[solo12002]

" Now on average on PAYG you are looking at 35p a min x-network. So for 100 x-net mins on PAYG you are looking at £35 a month minimum"

Thats the point I had tried to make about this deal. A lot of ppl spend £15 pounds per month on PAYG in fact one of TESCOs plan you have to top up by £15 pound to get cheaper rates, its a clear easy to understand plan which will still suite some ppl.

Bens point about " What 3 need is a gutsy, interesting PAYG product" I thought three had untill wee pay came out, I have one of the older three PAYG sim cards and if I top it up by £25 pounds I get 500 mins, its nearly worth my while going contract

However I am a student and dont think anyone is currently beating threes offer for students. the other reason why I would go to three is o2 has no 3G, vodafone does but no data access at a fair price , T-Mobile has , but I can get what i want for half price as a student.

I dont think three is the be all end off of networks, but they are currently trying to change.

[3GScottishUser]

3 UK is a network that needs high spenders buying premium content to inflate their ARPU to make their investment in 3G credible..... £15 a month 500 x/net minute contracts wont achieve that!!

Attracting students (if they can pass the credit check) on bargain basement contracts who were previously PAYG customers will simply drag down their ARPU which affects their net worth.

As stated above, good if the deal is what suits but a disaster for 3 in every way other than simple contract subscriber numbers

[Ben]

Of course if those cheap contracts help lure in new customers who may then go on to spend extra on all that content Three have invested so heavily in then there's the potential for the exercise to be worthwhile. It's certainly easier for a contract user to make purchases on their phone as they don't need to worry about having enough prepaid credit to do so.

[solo12002]

" cheap contracts help lure in new customers who may then go on to spend extra on all that content Three have invested so heavily in"

Yes and thats what I think the aim of this plan and three is, get ppl onto their network in the hope they will spend over and above. This plan is good for calls but as a user you either have to pay for text messages or take out a text add on.

despite it all this plan will suit some while I dont think it the b all end all, it will work for some ppl and i think its a good start.