Who Will Buy O2?. Some
Who Will Buy O2?. Some commentary from the UK about O2…
O2 is a very-badly run company. The decision making is confused and power so diluted that there is no strategy or direction. The company, like BT, is so self-absorbed that people there don’t think of their rivals in business as being their opposite number at other networks, but as those people they work for or who work for them.
Purchasing is a complete mess. O2 ordered 165,000 RIM Blackberrys. In the first six months they sold 6,000. And were proud of it. The order has been cut back substantially but this means that O2 has lost its exclusivity and still has a stockpile. It’s also not the way to treat suppliers, although such things are a habit with O2. Despite having warehouses full of ?400 Blackberrys, O2 decided to take the HTC Wallaby. Remember O2 is a network not a handset manufacturer, and has little in the way of systems to merchandise, sell, train staff or run telephone support for handsets. Wallaby is a lot more than a handset, it’s a Microsoft convergence product, a new version of Pocket PC OS, very difficult to support and generally unwanted.
The XDA is an OK product, in a couple of years time once HTC and Microsoft have learnt a by the initial mistakes it will beget an excellent product, but the problem O2 has is quantity. The most successful PDA in Europe is the Nokia 9210; this sold 53,000 units in a quarter. Handspring is rumoured to have sold fewer than 20,000 treo’s in Europe. For the XDA, O2 only has the UK and a minor presence in Germany and the Netherlands. A sensible number of units to buy would be 15,000. A wildly optimistic number would be 30,000. No, O2 is suspected to have bought 100,000. We’ve seen the first ?100 price cut, expect more.
Cutting orders is something O2 is getting a taste for, ask Quanta which was to have a phone sold exclusively to O2 with a pop group tie in, or Sharp, O2 ordered a very large quantity of camera phones and then cut the order by 80%.