Metropol

So they would've likely gone bankrupt soon anyway then.

JAS84 wrote:So they would've likely gone bankrupt soon anyway then.

It doesn't quite work like that.

Tax is always paid in arrears, so all companies which are trading, technically, owe a lot of tax on any given day.

It's only when you stop trading that the amount you owe in tax becomes significant, because you're no longer earning revenue with which to pay the tax bill.

That (reputedly) is why the tax man always has first dibs on the assets if a company goes bankrupt.

Nick Harvey wrote:That (reputedly) is why the tax man always has first dibs on the assets if a company goes bankrupt.

No longer true.

Just under a third of the store estate has been purchased by Vodafone and EE, whist all phones 4 u concessions in Currys/PC World stores have been bought by Carphone Warehouse. The stores will be rebranded and slot in to the respective businesses of the respective purchasers. All staff involved have been offered new employment with the acquirers. This saves about 2000 jobs - out of 5500.

That the bulk of the stores have been bought out by the very suppliers who terminated in recent weeks I do think is a matter for the competition commission - it does seem simply that the mobile operators wanted to kill off the competition before taking the opportunity to cheaply seize an easy way of launching in locations where they don't have any presence.

As I said in an earlier post, I don't think Dixons Carphone are safe for one minute. Phones 4 U was a much bigger operation which was trading at a profit but ultimately it took very little to bring them to their knees. Let's see how long it takes before they see their contracts with the mobile operators terminated and going the same way.

Isn't Dixons Carphone a bit more secure thanks to the Currys/PC World business which isn't reliant on mobile phone sales?

Phones4U were vulnerable as they relied on the contracts with the networks. The founder of the company said if he hadn't had sold the company, he'd go down the MVNO route on Sky News this evening, but I thought they did with LIFE Mobile?

While it's still a huge part of their business, Carphone Warehouse are not so totally reliant on contract mobile sales as Phones4u were. They have a pretty good selection of tablets with some quite aggressively priced offers - for a good while they were always the cheapest place to get a Kindle Fire for example.

They also seem to have a canny way of bringing networks on side. Three ended their contract with Carphone Warehouse a good 18months or so ago, and they've managed to bring them back by launching an MVNO with them.

There is a huge movement at the moment towards consumers choosing to purchase SIM-free and then take a SIM-only plan. With time, I would not be surprised to see Carphone Warehouse ditching the networks altogether.

I don't see them as any more vulnerable than their bedmates over at Dixons. Both are now in the position HMV were in 4 years ago, enjoying all of 2 shrinking pies.

EE tipped to acquire Phones 4u's MVNO LIFE Mobile.

http://www.mobiletoday.co.uk/news-list/ ... obile.aspx

Hardly surprising. Several thousand customers effectively on your own network already at a firesale price is surely a no-brainer?

Martin Phillp wrote:Isn't Dixons Carphone a bit more secure thanks to the Currys/PC World business which isn't reliant on mobile phone sales?

Phones4U were vulnerable as they relied on the contracts with the networks. The founder of the company said if he hadn't had sold the company, he'd go down the MVNO route on Sky News this evening, but I thought they did with LIFE Mobile?

They are more secure in that Dixons Carphone has Currys/PC World and as others have said Carphone Warehouse does a bit more in non-contract sales than Phones 4U did so no you probably wouldn't see the entire company go bust in the same way that Phones 4U did.

But I doubt very much that even with the extra non-contract sales that the Carphone Warehouse business would be viable if it lost the ability to act as a reseller for the mobile networks - it is just as reliant on them as Phones 4U was and it is a huge part of the merged Dixons Carphone business which will have a big negative effect on that business if it were to be lost.

When Carphone Warehouse has a very similar business model to Phones 4U, and when it does look increasingly like Phones 4U was forcibly killed off by the networks to avoid the competition (and done so in an impressively short amount of time - Phones 4U have gone from business as usual to nothing in only a few short weeks and there was no hint at all of anything being wrong at the start of the year) then as I have said before I don't know what they think there is to stop the same happening to them - even if it's longer contracts with the networks then that doesn't seem to make any difference either as EE have breached their contract by pulling out of Phones 4U a year early and precisely nothing seems to have happened to them for doing it. If I were Dixons Carphone I'd still be very, very nervous about the future of the Carphone Warehouse business.

Incidentally, there is now a published list of store closures - the stores which haven't been bought by Vodafone or EE.

http://www.cityam.com/1411475012/pwc-re ... -be-closed

The basic methodology seems to be this: In the (quite likely) even that Vodafone did not have a store in that town, Vodafone have bought it, in the (less likely) event that EE did not have a store in that town, EE have bought it, otherwise it's being closed. I've checked this with quite a few places near me and the formula hasn't failed me yet.

I did read with interest that the final assessment of Phones 4U's finances may be delayed by months since the very same network operators which have just closed them down also owe a significant amount in fees/commission to Phones 4U which has yet to be paid and so their books aren't yet balanced. I do wonder if Vodafone/EE will be working a deal to waive some/all of this in exchange for buying the stores which are only for sale due to their actions - which truly means they get to have their cake and eat it.

I must say that despite despising their sales practices I am truly starting to feel a bit sorry for Phones 4U...and of course this chap who's big dream has been blown...he went to university in order to pursue his dream career of working for them and everything and he doesn't want to work anywhere else!

Looks like the Phones 4u in Peckham has been saved, presumably by Vodafone as EE already have a store.

At least the bloke in that video will be keeping his job, as DSG are at least keeping on the staff in the Currys/PC World concessions.