Hutchison 3G tipped to buy mobile phone group

The deal could give Hutchison 3G a presence on high streets across the UK as it tries to tempt customers to embrace a third-generation future

Hutchison 3G, the only holder of a UK third-generation licence not to already operate a mobile network in this country, is being tipped to buy a chain of high street shops.

According to The Sunday Telegraph, the operator has been in talks to buy the Phones 4U chain -- a deal which could be worth £500m. This would give Hutchison 3G a total of 255 shops. Phones 4U is owned by Caudwell Communications.

If successful, the deal could help Hutchison 3G to boost its profile with British consumers. Unlike its rivals, Hutchison 3G doesn't already operate a mobile network in the UK. The likes of Vodafone and Orange can rely on some of their existing customers upgrading to 3G, especially if they have had a positive experience with GPRS data services.

Hutchison 3G, however, has to do it all from scratch. It denies that this is a serious problem, saying that it can devote all its efforts to a successful 3G launch, rather than being distracted by other issues such as GRPS -- the so-called 2.5G service that other operators are using as a transition from GSM to 3G.

According to company insiders, Hutchison 3G is planning to announce details of its branding in early 2002.

Hutchison 3G is aiming to launch its 3G service in September 2002. It is not expected to market its service to consumers as "Hutchison 3G", and company insiders believe it will reveal its brand name in early 2002.

Hutchison Whampoa holds a 65 percent stake in Hutchison 3G. Japanese mobile giant NTT DoCoMo owns a 20 percent stake of Hutchison 3G, while another 15 percent belongs to Dutch group KPN Mobile.

NTT DoCoMo operates the enormously successful i-mode service in Japan, and the company announced on Monday that KPN would launch a European version of i-mode soon. The close partnership between Hutchison 3G, DoCoMo and KPN has led to speculation that i-mode services could be offered in Britain on the Hutchison 3G network.

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