July Round Up
Should 16.67% appear to small, be careful I don't take it all...
Items of interest that are on the periphery or weren’t quite meaty enough to write a single post about (yet), continue to grow…
Market
A wide alliance of businesses, charities and community groups called on the UK government to enhance policy around the electrical product circular economy1. They call for greater measures encouraging repair and reuse and harmonising regulation in line with the EU Right to Repair. There is no reason for the government to do otherwise. However, the additional call for electronic repair to be zero rated, whilst admirable, feels like a longshot in the current economic environment. If the repair sector grows, as we all hope it does, the Treasury are unlikely to turn off the tax tap.
Following on from last month’s note on Captive Regimes, the UK Treasury published their captive insurance consultation response2 confirming they're pressing ahead with the new framework despite mixed feedback from the 42 respondents. The PRA consultation on new rules is set for summer 2026 with implementation by mid-2027. As I suspected, the government held firm on no tax incentives, which had been flagged by 8 respondents as crucial for international competitiveness. I assume this is partly why their expectations remain modest, pointing to France's 20 captives in the first 18 months and Alberta's similar performance as benchmarks for success. Following consultation, financial services firms will now be able to establish captives (initially excluded), certain life insurance products will be permitted, and compulsory lines (e.g. motor or employers liability) allowed on a reinsurance basis. With Protected Cell Companies also getting the green light for smaller firms, it feels like the Treasury listened to industry concerns about the original framework being too restrictive, even if the economic case remains a bit fluid.
The excellent Right to Repair coalition have called for further measures to improve the cost of repairing3. Quoting an ADEME 2024 study4, for consumers to consider a repair the cost must not exceed 30% of the product’s purchase price. Whilst corroborated by more recent professional services reports, the original quantitative data is from 2019 and there’s been much economic upheaval since. The long and short of it, is that Right to Repair have two key proposals:
Price commitments: Manufacturers must stick to their declared spare parts prices - no more treating them as "estimates" they can exceed at will.
Price in repair scores: EU repairability ratings should factor in spare parts costs, with products scoring poorly if parts exceed 30% of the product's price.
The first feels objectively achievable. The second is practically more difficult to justify, let alone implement. Your 30% might be my 50%, etc.
Amazon shared their view of the “Second Chance” market which includes open-box (buyers remorse) and refurbished item sales. Research by CEBR suggests the resale market across Germany, France, the UK, Italy, and Spain is valued at €21.6 billion5 and expected to grow to €23.8 billion in 2025. Amazon alone generated over €2 billion in second-hand product sales across Europe and the UK. Interestingly, the research showed a clear generational divide, with 85% of under-34s shopping second-hand online compared to just 52% of over-55s. Financially motivated purchases account for 34% of second-hand shopping and environmental concerns drive 30% of consumers. More secondary market purchase behaviour here in case you missed it…
Companies
Regular readers will know it’s not always easy to separate specific device sales from “non-service revenue” or “equipment revenue” in Telco results, but I’m keeping an eye on things for a general indication of device sales trajectory. In their Q1FY26 trading update, BT reported revenue down 3% year on year mainly due to weaker handset sales in Consumer and continued challenges in international trading6. Vodafone posted a mixed bag in their Q1FY26 results with Other Revenue down 8% in Germany and up almost 11% in the UK, although the impact of Three merger is unclear now the results are fully integrated. Across all Vodafone markets Other Revenue was down almost 3% overall7. VMO2 faired no better claiming a 5.2% reduction in low-margin handset sales in the quarter to June 30th and overall down 5.8% at the half year point8.
Mazuma Business announced a UK distribution partnership with Early Upgrade9, provider of the tabletop DataBot, destroyer of data on phones, laptops, tablets, & smartwatches. It looks like the drilling machine can be leased or devices can be shipped for destruction, presumably to Mazuma Business in this instance.
Speaking of robots, Apkudo launched a Device Passport10 that offers an identity linked to a device throughout it’s lifecycle. Presumably, that identity is only available if the device has been subject to Apkudo processing at somepoint in it’s journey. Regardless, the service is accessible to network operators, manufacturers, insurers, logistics providers, regulators and importantly, consumers. The news release specifically mentions the EU Circular Economy push and with the Digital Product Passport (DPP) legislation on its way, timing is spot on. The DPP will be accessible via QR codes, barcodes, RFID, or digital platforms. Data requirements and access rights are standardised but specified per product group via “delegated acts” under the Ecodesign for Sustainable Products Regulation (ESPR).
Apple introduced AppleCare One in the US allowing customers to cover up to three devices under single plan for $19.99 per month and add additional devices for a further $5.99 per month11. Customer devices less than 4-years old (headphones less than 12months) can be included in the plan as long as they’re in “good” condition verified by a diagnostic check using an iPhone, iPad or at an Apple Store. I like the sound of the plan management features which include automatically removing devices from the plan that are traded in (via Apple) and adding newly purchased devices. I’ve not seen any news on international release dates yet, but I’ve asked.
The EU came to an agreement with Corning over their monopoly dominant position in display glass supply12. They’ve pledged to waive exclusivity clauses with device manufacturers and not impose similar policies in the future. According to evidence compiled by legal firm Fideres13, Corning have a 72% market share in the global aluminosilicate glass market for electronic devices, rising to 80% if Apple’s Ceramic Shield (also manufactured by Corning) were included. The concessions are in place for 9-years, giving AGC, NEG and Schott an opportunity to up their game.
Orange, Dipli14 and GetRe15 offered us insight into their vision for in-store trade-in solutions in France. Customised ReBox machines being piloted in Orange’s Paris and Lyon concept stores recognise over 1,500 smartphone models and deliver customers a full diagnostic in under 4 minutes. AI evaluation offers the best price based on Dipli’s pricing engine. In order to lever the inordinate amount of dormant devices from everyone’s junk drawer, frictionless trade-in must become ubiquitous across multiple channels. Let’s hope Dipli or GetRe are willing to share some results…
GiffGaff appear to be testing trade-in price sensitivity by offering a time-limited £40 bonus on devices traded-in by the end of August 202516. Users on the community forum were quick to point out the offer doesn’t even get them close to market pricing. Congstar, T-Mobile’s discount flanker brand on the other hand launched a trade-in for discount over the lifetime of your phone contract with average savings quoted at 20%17. Back in the UK, after Samsung launched their trade-in guarantee in May, they appear to have extended their stand-alone trade-in offer by giving customers a 5-year lifetime for Samsung credits and making them redeemable across a wider range of Samsung’s household products18. Retailers got in on the announcements too, with Staples Canada announcing an electronics trade-in service with Allstate Protection Plans (SquareTrade)19, hopefully, putting the still shiny Kingfisher capability acquisition to good use.
Continuing the trade-in theme, it’s not just European companies upping the ante, Flipkart, the Indian-based, Walmart-owned online behemoth launched a new smartphone exchange on it’s quick ecommerce platform, Flipkart Minutes20. Currently, the service allows customers in Bengaluru, Delhi and Mumbai to swap old phones for new ones in under 40minutes. The service is facilitated by Prexo, (Flipkart’s pre-owned certified exchange) which offers doorstep diagnostics and immediate value assessment.
For customers not quite ready to trade-in, Vodafone launched an in-store repair21 service, 3 years after EE did the same through a partnership with S.B.E. The Vodafone version launched in 5 stores (London, Edinburgh and Cardiff) with a 6th opening in Belfast by the end of July. Rollout to a further 18 stores is expected by the end of the year. Fingers crossed that Vodafone’s partner Fonehouse has diligently studied iSmash’s or S.B.E.’s accounts for hints and tips on how not to do it.
For those customers further back in their digital device journey, Assurant announced a new service with Lloyds Bank as their Digital Helpline partner. Financial education is becoming an increasingly important responsibility, especially for vulnerable and older customers as branches continue to close. As part of the service, eligible customers will be sent a free tablet, loaded with a 40GB per month Vodafone SIM and access to the internet for 6 months. Assurant will contact the customer to aid set up and then be there for ongoing support including downloading apps, paying bills and accessing local services.
Assurant hit the news again with Canadian Dr Phone Fix who announced a partnership22 to accelerate the sale of certified pre-owned phones with the insurer, only three weeks after they announced a national repair partnership with rivals Likewize. Despite my general consolidation narrative, I do sometimes wonder if there’s enough competition in this sector? Mind you, it was only a few months ago that Likewize announced their expanded remote repair service for Samsung in Germany and now Samsung have just announced the same programme in the Netherlands with repair outfit Fixers23. Maybe competition is doing ok after all.
Despite me being continually sceptical of startup valuations, I have to hand it to Bolttech. At the beginning of July, they launched AISCare+ for AIS, in partnership with Samsung. The product embeds SamsungCare+ and allows a screen replacement once per year, unlimited repairs with no claim value limits, up to two device switches per year, and one full device replacement annually. That could be some significant volume. Not only that, they’ve launched a connected health subscription with QBE and OMRON in Singapore for wireless blood pressure monitors24. Insurance and support services for remote health monitoring equipment is something my consulting clients know I’ve been banging on about for the last 12months or so. Finally, some more details emerged of the Bolttech-Sumitomo partnership. Sumitomo Corporation will offer Bolttech’s embedded device protection solutions to its distribution partners in the region, including instalment-based device sales and upgrade programmes. That wasn’t an advertorial, I promise.
Investments
JD.com initiated a takeover bid for CECONOMY, the parent of MediaMarkt and Saturn. The cash offer of €4.60 per share values the equity at around €2.2bn25. The offer price represents a 43% premium to CECONOMY’s 3-month average share price. Investors in various refurbished marketplaces take note, CECONOMY’s 2023/24 revenue was approximately €22.4bn, a quarter of which is online, with €305m in EBIT. The investment is the most significant by a Chinese company in Europe in recent years and the regulator has perhaps been assuaged by JD.com agreeing not to enter into a domination and profit and loss transfer agreement. Practically, this means that CECONOMY retains operational independence and minority shareholders (including the founding Kellerhals family) retain normal economic rights for 3 years post deal. Precisely how JD.coms investment thesis of accelerating Ceconomy’s transformation into Europe’s leading omni-channel consumer electronics platform therefore, remains to be seen. Expect the deal to be closed in the first half of 2026.
Only time will tell if it’s good or not, but I was glad to see some movement on Exertis. Recall that DCC plc put their technology distribution arm up for sale back in November last year. In the middle of July, Munich based private equity firm Aurelius Group reached a definitive agreement to acquire the UK technology distributor. No financials or deal terms were reported other than an approximate £100m enterprise valuation. Given cash, debt and working capital adjustments, the actual purchase price will be much lower26. Curiously the deal excludes the specialist AV business which will remain with DCC. Aurelius Group’s thesis is that after a period of “targeted growth and core operational improvement measures”, they see significant earning potential27. That doesn’t sound like a debt load up quick flip to me.
Finally, it hasn’t taken too long for the European telco market to heat up with Blackstone eyeing up a €35bn bid for SFR28 and Orange weighing up a bid for full control of MASOrange in Spain29. With Blackstone looking to invest $500bn in Europe over the next 10 years, adding to their existing telecoms assets seems like a safe bet. Right, I’ve blown through my 20 footnote limit guidance, so that means it absolutely time I shut the laptop and went for a run.
A special thanks to all my new subscribers this month and especially those of you that opted to pay.
Peace,
sb.
New Research Articles Last Month
Raylo Group Limited Research Update - Paid
Apple Retail UK Limited Research Update - Paid
EU Circular Economy Act 2026 Market Update - Free
GiffGaff Research Update - Paid