Dialaphone

» see dialaphone.co.uk as it lived, on the wayback machine

~ the obituary ~

Jonathan Beck and Richard Frank started Dialaphone in February 1995 with money borrowed from Beck's father. It paid for telephone lines and recording equipment and not much else, which left them running a mail-order business with no software to track an order in it. Beck's answer was trays and runners: physical trays for the paperwork, people carrying them between desks. The company that started that way would spend its last decade as a website.

The model was almost crude. Buy a double page spread in a tabloid, print the deals and a phone number, answer the calls, process efficiently enough that the margin on a mobile contract covers the ad. British newspapers in the late 1990s were full of these spreads and most of them have been forgotten, but the overheads were low and the mobile market was expanding underneath them at a rate that forgave a lot. Within four years Dialaphone had grown enough to attract investors, and in 1999 Barclays Private Equity took a majority stake in exchange for the capital to go online properly.

The online transition is the one part of the record that does not hold still. Wikipedia's article says in one place that the e-commerce site launched in May 1998 and in another that it went online in September 2000. Where it ended up is not in dispute: the website became the main source of revenue, and Dialaphone became one of the largest online mobile phone retailers in Britain and the third largest connector of contracts in the country.

In the summer of 1999 the founders brought in a new management layer, and the managing director was Andy Brown, who had worked for John Caudwell at Phones 4u. He widened the marketing beyond newspaper spreads into scratchcards, catalogues and television, and he put the name on things people watched. Dialaphone was Middlesbrough's shirt sponsor from 2002 to 2004. Brown left in April 2006 after seven years, over where the business should go next, and the turnover reported for the year behind him was about £195 million. The sponsorships outlasted him. The brand was the official mobile partner of Premier League Darts in 2011 and put its name on the Rugby League Challenge Cup.

~ the case file ~

~ the free gift ~

What Dialaphone actually sold was not really a phone. It was a contract, and the handset was the inducement, along with whatever else could be stacked on top: a free gift, usually some small piece of consumer electronics, and cashback on certain tariffs. The retailer's money came from the network's commission on the connection, which meant the whole industry had an incentive to make the thing in the box look free.

That arrangement never had a Turkish equivalent I could recognize. Mobile in Turkey through those years ran on prepaid, and a handset was something you bought outright from a shop and then fed credit into. The British habit of treating a phone as a bundled extra on a two-year commitment was visible to me only in the background of English websites, and the apparatus of cashback claims and free gifts that grew around it was never an economy I had to learn.

~ we are offline ~

In February 2008 Phones 4u, Andy Brown's old employer, bought Dialaphone for a reported £9 million. By then the contract volumes had been falling for a while and the price reflected it. For six and a half years the site carried on under the new owner, selling handsets from all the major manufacturers on the main UK networks.

Then on 14 September 2014 the last mobile operators ended their contracts with Phones 4u, and on 15 September PwC partners Robert Hunt, Ian Green and Robert Moran were appointed joint administrators of the group. The Dialaphone site stopped being a shop. Wikipedia dates that to the 14th, the day the networks walked. In its place went a page headed "We are offline" which listed the administration dates and then printed the customer service numbers of ten networks so that people could ring up and cancel contracts the retailer had sold them. Near the bottom it addressed anyone who had been promised a gift or a cash incentive before the administration started. The domain expired the following spring, and by May 2015 the address was serving a parking page.

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