Rumour Mill: Nokia drops O2 UK as Windows Phone partner

Nokia dropped O2 UK from the list of operators to stock the company's first Windows Phone handsets, according to a Mobile News report, which cited unnamed sources. O2 UK is thought to have rejected the strict distribution terms requested by Nokia given the imminent launch of Apple's new iPhone.

The report said sources close to both companies said that the conditions related to selling the Nokia Windows Phone were too severe for O2 UK in terms of stock levels, sales volumes, store displays and marketing campaigns. Indications that relationships between O2 UK and Nokia have become strained came from reports that the operator was not present at a dinner hosted earlier this month by Nokia CEO Stephen Elop which all other UK operators attended.

However, Richard Baylis, O2's head of retail, told Mobile News that he was unaware of any decisions that had been made to exclude O2 UK from selling Nokia Windows Phone devices. Baylis added that he would be very "surprised" if O2 did not carry the first Windows Phone device, based on its established connections with Microsoft.

O2 UK is reported to be the largest supplier of iPhones in the UK and has built a reputation for marketing the device more effectively than all other UK operators. It is thought that the company is very reluctant to jeopardise the relationship it has built with Apple, and its early enthusiasm to distribute the new Nokia Windows Phone devices is said to have cooled in recent weeks.

Nokia has said it is "increasingly confident" that its first Windows Phone product will be released this year.

For more:
- see this Mobile News article
- see this Telecom Paper article (sub req)
- see this Reuters article

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