3 Pressure kills Superdrug Pre-Pay Ambitions

[3GScottishUser]

From Mobile Today (13/05/2005):

A deal to sell a range of 2G prepay phones in Superdrug has been quashed at the eleventh hour.

Superdrug management is thought to have agreed commercial terms with a supplier and was ready to stock handsets from networks other than 3. However, the move, which could have seen handsets from Virgin and others on the shelves, was pulled.

Hutchison Whampoa, which owns both Superdrug and 3, is thought to have emphasised the importance of 3 in Superdrug stores and is unlikely to have approved of any innovation that might have seen rival networks competing in store.

The tabled deal involved the supply of prepay phones to all Superdrug’s 700 stores, apparently starting with Virgin but moving on to other networks. ‘Virgin Mobile is known to be looking for additional outlets,’ said a senior source from one multiple retailer.

The distributor involved is thought to be a leading player in prepay. Hutchison Whampoa is the parent company of 3 as well as Superdrug, although Superdrug is technically owned by Hutchison subsidiary AS Watson.

A source close to the deal said: ‘[Superdrug] see other non-traditional retailers on the high street selling large numbers of prepay handsets and they saw it as a big opportunity.’

The source claimed the deal was scuppered after senior managers at Superdrug intervened.

Superdrug would have joined rival pharmacists Boots as well as other non-specialist retailers such as Woolworths, Argos, Comet and Tesco, which have grabbed a large chunk of the prepay market over the last year.

A spokeswoman for Superdrug said: ‘We currently stock a range of prepay phones through 3G concessions which operate in over one hundred Superdrug stores. We can confirm we are happy with the current arrangement we have with our sister company and currently have no plans to review this.’

http://www.mobiletoday.co.uk/artman-...icle_373.shtml

[delinquentwoody]

This is unsurprising that this didn't come to fruition. Virgin would have been laughing if they got their PAYG handsets next to 3's, as there is no comparison which is the better deal! If this had been allowed to go through, Hutchison would have been shooting themsleves in the foot with a very large bullet.