The new Voda/Yes power axis

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If not quite the corporate equivalent of a mob whacking, Vodafone’s career dispatch of three Yes Telecom directors earlier this month was certainly clinical and shocking for those close to the situation.

Summoned to a meeting at Vodafone’s Newbury headquarters on the afternoon of February 5, Yes Telecom sales and marketing director Simon Howitt (pictured left), finance director Kevan Wakerley and IT operations director Ray Bell were summarily dismissed, put on gardening leave.

The relationship had been strained for some time, but sources close to the trio claim surprise and anger on their parts.

At the same time as the Newbury firings, Vodafone UK enterprise director Peter Kelly entered Yes Telecom’s head office in a leafy Manchester business park to inform staff former Avenir Telecom UK managing director Tanny Price (pictured middle) was taking immediate charge as part of her remit as new Vodafone head of distribution.

In Newbury, Howitt, Wakerley and Bell had been instructed by Vodafone director of enterprise sales Amanda Baker they were not to set foot on the Manchester site again.

Ten days later, Vodafone confirmed Price’s old employer, Avenir, had been ditched, leaving just Redstone of traditional airtime distributors on it books.

There was a section of the channel that saw the changeover at Avenir when Price quit for Vodafone in December as a way for Vodafone to work closely with its Avenir base – and even to work away at rival O2’s Avenir base. Her replacement, Andy Tow (pictured right), is considered a Vodafone veteran and favourite, and Price is believed to have recommended him to Avenir group management in France.

It looked as if Vodafone might have organised, or at least lucked out on, a smart succession at Avenir to check O2’s tearway success in the third-party SME connections market. In the end, such a conspiracy theorist view guessed at too much Vodafone cunning – and made too much of Tow’s connections.

In the end Vodafone was premeditated and clinical. Compelled by its drive to cut operational expenditure (in November, it  stated it would cut £1 billion in annual costs by 2011), Vodafone looked suddenly to make good on its 2006 assessment of the dealer market and its original vision for service provider Yes Telecom: indirect business is too expensive and unreliable and Yes Telecom, purchased that summer, should be made its primary connections house for dealer sales.

But it took Vodafone to remove the remaining members of the original Yes Telecom management team and install Price, the acceptable corporate face of distribution, to finally get it close to its 2006 game plan. Why?

The Newbury firings were strangely familiar. Yes Telecom founder Keith Curran ‘disappeared’ on duty just over 12 months ago, to be handed a vague, roving brief on Vodafone “special projects”.

Nothing was heard from him again until the start of this year, when he declared himself engaged in various new projects separately of Vodafone – interestingly, he maintains a strong continuing interest in service provision and MVNOs, among other things (see issue 434, out March 9).

Vodafone’s purchase of Yes Telecom in 2006 was structured around a five-year earn-out deal, linked to tough KPIs, for Curran, as well as Howitt, Wakerley and Bell. The quartet was slated to share a chunk of the potential £22 million earn-out each year for the period, provided Yes Telecom hit performance targets.

How that earn-out contract, ended three years early, will be realised now is unclear.

Curran won’t discuss the original deal at all, nor his ‘leave’ with Vodafone. The loyalty he engenders from his old dealer comrades is also immense, and the curious gagging order put in place when he was removed from Yes Telecom at the start of 2007 remains in place.

However, there are some leaks around Curran’s former team, who assumed full control of the business following his exit, even if the trio could not be reached for this article.

Full article in Mobile News issue 433 (February 23, 2009).

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