Telstra names Brightstar as sole cellphone supplier

By Stuart Corner
Tuesday, 18 October 2005 15:13

Deals

Telstra has appointed global cellular products distributor Brightstar as the exclusive source for all wireless phones, devices and accessories.

Telstra hopes to leverage Brightstar's relationships with major manufacturers as well as its global sourcing and procurement power to obtain mobile devices that increase Telstra's product portfolio while reducing overall product costs.

As an independent cellular operator Telstra is at a relative disadvantage to the other three carriers in Australia which are all part of larger entities with much larger global customer bases that give them significant negotiating power with global handset manufacturers.

Telstra's COO, Greg Winn, said: "This partnership will drive device costs down due to Brightstar's procurement power, which will make us more competitive and provide additional benefits to customers and shareholders."

The agreement between the two organisations, which is for one year with an option to renew, designates Brightstar to procure more than two million wireless devices annually on behalf of Telstra. The two companies will collaborate on defining product strategies and identifying portfolio requirements. Brightstar will then be tasked with working with global manufacturers to obtain the correct products, negotiate best pricing, purchase and deliver them to Telstra's specifications.

Earlier this month Motorola appointed Brightstar as its exclusive channel for handset sales in Australia and a number of other countries.

According to Brightstar's COO, R Marcelo Claure, Brightstar plays a similar role with other cellular operators around the world, including Verizon, America Movil and Telefonica, "Brightstar's model focuses on cutting time and costs out of the supply chain and introducing new products and technologies."

Telstra's group managing director Consumer and Marketing, David Moffatt, said: "Telstra had discussions with Brightstar as early as December 2004. Since then we have been investigating ways to improve our speed to market and cut costs without reducing service levels or access to new technologies to our customers."

His comments relate to a report in The Australian newspaper last month which revealed that Telstra was negotiating with Brightstar and which claimed that were close ties between Brightstar's CEO and Telstra CEO, Sol Trujillo. Telstra moved swiftly to deny any impropriety.

Brightstar's Australian subsidiary is based in Melbourne with sales offices in Sydney, Brisbane and Perth. It was incorporated in October 2004. Parent company, Brightstar Corporation, based in the US, was founded in 1997 and now operates 30 facilities in 22 countries and serves 160 network operators and more than 15,000 resellers, retailers and agents. {mos_ri}