Redstone gains from Yes drop

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Vodafone owned Yes Telecom is missing its Vodafone targets on new connections. Sources claim rival Redstone’s contract to distribute Vodafone airtime has been extended as a result.

Mobile News understands Yes Telecom has missed new customer connection targets in four of the past five months of 2009, and is slated to miss its June target too. Yes Telecom has a monthly target for new business of 5,500 connections. It achieved 65 per cent of that target in January,  75 per cent in February, 63 per cent in April and 94 per cent in May. It hit 150 per cent of its target in March, when former Vodafone head of distribution Tanny Price was briefly in charge of operations.

Yes Telecom staff claim to have been told in a meeting in early February that Vodafone was to axe distributors Avenir and Redstone. Avenir was axed within weeks of the announcement,  and swiftly followed up by securing an injunction against its former managing director Price working at Vodafone. Price exited Vodafone last month to join Brightstar Europe.

Staff were subsequently told in March that Redstone was to remain, under review. It is being monitored presently for connection volumes and churn rates. Redstone is also under performance review by O2, as is distributor HSC, Mobile News understands.

At press, Vodafone and Redstone were unavailable for comment.

One source said: “If Yes Telecom had been hitting targets, Redstone would have probably gone by now.”

Another source said: “If Vodafone can manage its distribution to the independent channel, it won’t want to keep paying third parties?”

Yes Telecom’s strategy to attract dealers from Avenir and Redstone was to offer them ‘gold status’, providing them with an instant ongoing revenue share of connections as well as upfront commissions. Other benefits included the removal of clawback for customer inactivity.

Some Yes Telecom dealers claim to have been agitated by the move, having themselves been made wait up to six months for a performance review to be put forward for upgraded ‘gold status’.

Vodafone is expected to rebrand Yes Telecom as Vodafone Distribution shortly. Yes Telecom staff have had a limit placed on Yes Telecom-branded stationary orders due to a “possible name change.”

For full story, see Mobile News issue 441, out Monday June 15. To subscribe, click here

 

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