Merging of T-Mobile and Orange brands to blame
EE is to close at least one in ten stores within the next three months following the merging of its former T-Mobile and Orange brands. The re-branding in October 2012 cost EE a rumoured £50 million, but it has left it with more stores on the High Street than it needs. The company, owned jointly by Spain’s Telefonica and Deutsche Telekom, now says it will shut 11 per cent of its existing 700 stores, though the locations have not been named. A question mark similarly hangs over frontline staff, though EE says some will be offered work at alternative stores though it’s thought managers’ job, in particular, will be at risk.
By the end of April [2013] EE is expected to have roughly 626 stores left, which still makes the operator the third largest mobile phone retailer on the high street behind Carphone Warehouse which has 800 outlets and Phones 4U with 681.
Of the remaining players, O2 is said to have 464 stores, Vodafone 350 and Three has 349, though all have been struggling to compete as consumers turn to buying devices online.
Behind the scenes it’s known that both Telefonica and Deutsche Telekom need to cut back, with the latter announcing just last month that it is to slash dividends to invest more heavily into broadband infrastructure.
Similarly, Telefonica recently resorted to floating off part of its German O2 subsidiary to raise more cash.
