Vodafone to sell pre-paid mobiles in Boots stores

VODAFONE IS close to a distribution deal with Boots that would see the retailer selling the mobile-phone operator's pre-paid handsets in its stores.

The agreement, which is due to be announced shortly, will give Vodafone improved distribution for its pre-paid phones, where users pay for calls up front and do not have to sign a contract. Boots will also sell the cards which carry additional call time.

The move comes as mobile- phone operators gear up for what is likely to be their best ever pre-Christmas selling season. Most of the phones being sold over the next three months are likely to be the pre-paid variety, which have enjoyed immense popularity since they were launched last year.

Pre-paid phones have opened up a new market for mobile phones by targeting users such as students who are reluctant to commit themselves to paying fixed monthly fees. The phones sell for as little as pounds 75.

Last year, Vodafone sold its Pay As You Go phones through retailers including Woolworths and Comet. It has also signed a deal to distribute the phones through Sainsbury's chain of Savacentre superstores.

One2One, the rival operator that is 50 per cent owned by Cable & Wireless, is understood to be negotiating a distribution deal with Sainsbury.

Vodafone is today expected to release sales figures showing that it has extended its lead over rivals in the past three months. The operator is expected to have added a net 280,000 new subscribers over the quarter.

Meanwhile Cellnet is understood to have mounted a strong recovery with both its pre-paid service and its Cellnet First campaign. The operator is likely to claim second place for the quarter, adding more than 200,000 net new subscribers.

Orange, which does not release its figures until Friday, is likely to come third with 200,000 new subscribers, while One2One is believed to have come last with 190,000 new users.

The figures will show there are 10 million mobile-phone users in the UK, representing a market penetration of 18 per cent.