RadioShack Kicking Out T-Mobile for Verizon
RadioShack has booted T-Mobile USA from its stores due to a breach in their contract.
Reuters reports that RadioShack has kicked T-Moble USA out of its stores in favor of a more profitable wireless carrier, Verizon Wireless.
The news arrives six months after RadioShack alleged that T-Mobile USA had "materially breached" their contract and that the carrier's product offerings just weren't competitive enough to stand up against local rivals like AT&T and Verizon. Just recently the latter wireless carrier began offering the CDMA version of Apple's highly-coveted iPhone 4 – a smartphone that T-Mobile does not currently offer here in the States.
Still, Radio Shack would not reveal how T-Mobile breached its contract, but merely indicated that terminating its relationship with the carrier was a simpler, faster and cheaper solution to the problem than taking the legal route. Its new deal with Verizon Wireless will begin September 15 and bring postpaid and prepaid wireless products and services to more than 4,300 Radio Shack locations nationwide.
"That is actually a pretty big deal," Wedbush analyst Michael Pachter said, adding that Verizon is a pretty big partner – three times that of T-Mobile USA, in fact. Verizon's larger customer base will be a "boon to the retailer" who apparently has been struggling with weak sales despite its "ubiquitous" nature.
According to Reuters, quarterly profits dropped after weak consumer demand and "cutthroat competition" forced RadioShack into offering more "margin-sapping" discounts. Net income fell to $24.9 million in the second quarter, a dramatic fall from the $53.0 million it claimed in the same quarter in 2010. Sales at the company fell to $941.9 million from the $962.3 million seen in the same period last year. Yet just the mention of its upcoming partnership with Verizon has already jacked up RadioShack's shares a hefty 19-percent.
RadioShack has reportedly been trying to counter weak demand for converter boxes, antennas and other accessories by selling wireless devices and calling plans. And while analysts are optimistic about its new venture with Verizon Wireless, there's concern that the electronics retailer needs to re-brand itself as a destination for mobile phones and cater to younger customers who are unfamiliar with the seemingly forgotten chain.
Back in August 2009, RadioShack tried to re-brand itself as "The Shack" in an attempt to reel in new customers on a more personal level. "Trust is a critical attribute of any successful retailer, and the reality is that most people trust friends, not corporations. When a brand becomes a friend, it often gets a nickname — take FedEx or Coke, for example. Our customers, associates and even the investor community have long referred to RadioShack as 'The Shack,' so we decided to embrace that fact and share it with the world," said Lee Applbaum, RadioShack's chief marketing officer.
To our knowledge, The Shack is currently only used on the company's web blog – even the weekly ad doesn't use the hip "The Shack" name anymore.
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People still purchase from Radio Shack? I live near a Frys and Best Buy. I never go to my neighborhood Radio Shack.
People still purchase from Radio Shack? I live near a Frys and Best Buy. I never go to my neighborhood Radio Shack.
I don't even live near fry's or best buy and I still don't use radio shack...
I bought 1/4" to 1/8" adapter once from there. it was like $8. back to Wally-World
I still go to Radio Shack when I'm in a pinch for the things I used to always buy there - A/V cables, adapters, speaker wire, etc. Otherwise, I shop online. Of course, I'm also a bit of a DIY audio hobbyist, so they do get regular business. Best Buy certainly doesn't carry the necessary components to build your own speaker crossovers.
I pretty much despise the "big-box" stores, mostly due to the majority of their staff lacking technical expertise and knowledge.
The name "RadioShack" doesn't really invite most people into the store. Their prices are rarely competitive and most of their stock isn't stuff you'd find at a typical electronics store. They carry a lot of "store brand" and off-brand items that lack the quality most people want or expect. Their "associates" lack the knowledge needed to provide customers with proper advice. For me, I have the choice of going to the mall, or going to a rather questionable area to get to a RadioShack store. So, I get either the inconvenience of having to walk through a shopping mall and fighting with the crowd. Or I can go to a questionable neighborhood and hope someone doesn't break into my car or shoot me while I'm sifting through all the crap nobody wants to find what I need. Maybe if RadioShack were to move into better areas and start carrying items that people are most likely to buy, as well as promoting a better company image, they'd be more attractive to younger customers.
P.S.: Hey RadioShack....AOC TV's are garbage and their "warranty" is even worse. Try selling a brand that actually has quality control and a real warranty!!!
Verizon seems to be better carier for many interests at times, when interests come to be, but yet AT&T is harder one of interest to find, even though its all around to say???
Otherwise if anything of anything, its once less store with a service, so for service, wha should be expected of it, since it no longer carriers a interest of use anymore? Hard saying.
But of it now though, going to RadioShack for maybe some if not many, can now use Verizon, right? More then before, kinda either way on "ways".
I have slight partial in the issue myself, so im trying to refrain from some use of opinion.
Why would you want 2 AT&Ts in the same shop. I think thats a smart move.
Radioshack blows. I know, I worked there for years. It's where dreams go to die.
Good if you need a quick resistor or such. Used to have a much better selection of electronics, but now they seem be scaling down their niche.
I think if you blacklisted the phrase "Let's facelift bar!" there would be a lot less spam. Whatever that means.
wow toms, you ever gonna do something about the massive spam flood? just wow, theres 7 on this page and every other article being flooded also!
Good if you need a quick resistor or such. Used to have a much better selection of electronics, but now they seem be scaling down their niche.
Pretty much this. Radio Shack was always a good place to go when you needed specific components to build some device you were working on. That part kinda waned as it tried to become a general electronics retailer, and personally I think that was a bad idea. They really should go back to their roots and start stocking every adapter / connector and component that's commonly used. Then further create a catalog that allows a customer to order any known adapter or component possible.
yeah true, now its 50% phone section, a big tv and entertainment section, and the little isle for components. Anyway Im surprised they stil havent officially changed the name to The Shack.
I once had a RS employee tell me AT&T service was better because all the customers he met had complaints about Verizon and were switching to AT&T. When I explained to him that, of course, since they only offered AT&T service, that would be the only kind of customer he would meet (unless there are people who would make a special trip to their local RS store just to tell them that they liked their Verizon service and were not planning on switching). He couldn't grasp the concept, and just argued that AT&T was better.
Pretty much this. Radio Shack was always a good place to go when you needed specific components to build some device you were working on. That part kinda waned as it tried to become a general electronics retailer, and personally I think that was a bad idea. They really should go back to their roots and start stocking every adapter / connector and component that's commonly used. Then further create a catalog that allows a customer to order any known adapter or component possible.
I concur. Radio Shack was the place to go if you were the DIY audio/radio/electronics person for exactly what you said. Then they tried to change, which was not a bad idea, just they dumped a good portion of what people went to Radio Shack for. It has been a while, but I bet if you walk into one today you will see what I saw the last time I did. The dumb customers are at the front of the store looking at the cheap crap; while the smart ones are in the back cuby area where Radio Shack still has, although getting smaller by the day, all the necessary components to fix or adapt just about anything.
Radio Shack was the place to go if you were the DIY audio/radio/electronics person for exactly what you said.
They will have a hard time supporting all 4,300 RS stores with the 17 people who still have a custom discreet electronics hobby.
I remember shopping at Radio Shack for a new connector for my Atari gaming system in the early 90's. I haven't been back since.
People still purchase from Radio Shack? I live near a Frys and Best Buy. I never go to my neighborhood Radio Shack.
yes i still use RadioShack once in a while....you can find some stuff that no other store has...like diodes, capacitors...etc
yes i still use RadioShack once in a while....you can find some stuff that no other store has...like diodes, capacitors...etc
nvm....i just realised that Fry's has that stuff too, lol.....for some reason i prefer to get it from RadioShack, lol
to all you people complaining about radioshack's products:
They ONLY care about cell phones. Period. anything else is a side dish. An insider not-so-secret: if you buy say a 4 pack of fuses for 2.19$ +tax, radioshack paid near 10c for it. nearly everything you buy is marked up 250 - 300% minimum. Their profit margin per item is ranked similar to best buy.
besides when a company states they "lost" XX million dollars. it means they made less profit this year than last year. they didn't lose anything. If you lose 20$, you actually lost it. see the conflict?