Should we be worried by the collapse of Phones 4 U?

EE ends contract early – presumably without exorbitant cancellation fees

by hodg100
Tech News

17

Should we be worried by the collapse of Phones 4 U?
EE’s withdrawal of support for retailer Phones 4 U has had dramatic consequences with all stores set to be shuttered from today.
Seemingly, EE – Phones 4 U’s last remaining network provider – announced it would no longer allow the retailer to offer contracts on its behalf last Friday (12th September), with more than a year remaining on the agreement.

Reports suggest that EE were concerned with Phones 4 U offering only their own network, thus making the stores less attractive for shoppers looking to compare prices. We would have thought having a retailer with high street presence, selling only their contracts, would have been quite attractive to EE but it would appear not.

There is also the fact that EE has its own high street outlets to look after, of course, and this move can only strengthen that side of the business, one would think. As well as giving more custom to Dixons Carphone, who still maintain deals with all three of the major networks – EE, O2 and Vodafone, although how long that will last is also open to question.
Dixons Carphone is considering a complaint against the networks
Should we be worried by the collapse of Phones 4 U?

According to the Telegraph, Dixons Carphone is considering a complaint to industry watchdogs, with the allegation that mobile operators are in collusion, intending to ramp up pricing and drive out high-street competition, so they are clearly also worried about their future.

John Cauldwell, the man who founded Phones 4 U, certainly believes so and he is quoted as saying, “It feels to me as though these networks are acting in unison. It’ll be good for the networks ultimately but it can’t be good for the customers, taking all that freedom of choice away.”

So, will we soon be faced with a situation where can only go direct to the networks for a deal on a new handset and will that lead to higher prices and more prohibitive contract terms? And what can be done about it?

Or is there already more than enough choice out there and we shouldn’t be worrying?

Over to you in the comments below...

Source: The Telegraph
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