Dealers have lashed out at 3’s latest commission restructure, as previously it paid equal commissions across both upgrades and new connections.
The move goes against the message to drive retention that the networks and distributors have been pushing for the past year, which is one of the main driving factors the introduction of revenue share programmes from O2, Orange and T-Mobile.
3 however said it was investing more than ever in the dealer channel by increasing marketing budgets and the number of channel managers.
Distributor HSC’s October bulletin showed that for Mix & Match 300 tariffs, dealers will now receive £140 for a new connection but only £100 for an upgrade.
On Texter 35 tariffs, new connection commissions stand at £285 but upgrade commissions are £70 less at £215. Previously commissions were comparable across both new connections and upgrades.
The bulletin also shows that the network has removed discounts from all business plans. Previously 24-month contracts attracted a 25 per cent monthly discount and 18-month contracts had a 10 per cent discount.
All 12-month contracts have been scrapped across business and consumer.
Changes have also been made to the maximum number of users on business Sharer Plans.
3 is now allowing a maximum of just five sharers, cut down from 10, on its Business Share 2,000 tariffs, while the maximum number of sharers on Business Share 4,000 has dropped from 20 to 10.
Commission on Business 900 tariffs has also been reduced by £28 on both 18-month and 24-month contracts.
One dealer said: “I can’t understand where 3 is coming from. Its main selling point was that it always treated upgrades the same as new connections in terms of commissions. It has talked about attacking the business market and working closer with dealers but with this latest debacle, none of this makes sense.”
Another dealer said: “Removing the line rental discounts from all business plans is a big blow. This was always an attractive proposition but customers will now be extremely reluctant to sign up to longer-length contracts now that these discounts are no longer in place.”
But a 3 spokesperson said its business tariffs remained competitive.
“We are currently in the process of making a significant investment in this, for example by putting more money into marketing and increasing the number of channel managers, which demonstrates our level of commitment. We aim to continue building sustainable viable relationships with key channel partners in the coming year.”