John Lewis ups ante in Dixons PC dispute

NEWS The exclusive agreement between computer manufacturers Compaq and Packard Bell and high-street retailer Dixons has come under fire once again this week. Retailers John Lewis and Tempo met with the Office of Fair Trading (OFT) in an attempt to convince the department to re-open its investigation into the agreement. In April, the OFT said it saw no reason to investigate Dixons any further, following an investigation into the deal last year. But John Lewis and Tempo remain unconvinced, and argue that the agreement restricts consumer choice and could lead to artificially high prices for consumers. Paul Burden, director of communications at John Lewis, said part of the problem was that the OFT had not released its findings. He told silicon.com: "As far as we can see they gave it a rather cursory examination. They've not given any indication of the scale of the investigation or the quality of the research they undertook. We'd like to see the full research published." The two retailers presented the OFT with research which indicated that 53 per cent of consumers are concerned about the lack of competition in the market. The survey also showed that of those who had bought a home PC from a retail shop, 57 per cent made their purchase at a Dixons-owned outlet. The OFT's original findings concluded that consumers were given choice through online sales and mail-order firms, as well as high-street shops. But according to John Lewis' Burden, the average first time PC buyer needs the help and advice of a shop assistant. "We want recognition by the OFT that buying on the Internet or by direct mail is not an equally accessible alternative," he said. But according to Graham Patterson, marketing director at Packard Bell, the complaints are "a storm in a teacup". He said: "The exclusivity deal with Dixons is a natural evolution. The vast majority of our business has been going through Dixons, with only a small proportion from John Lewis." Patterson added that although consumers will be left with no choice of where to buy Packard Bell PCs, that doesn't mean they're being exploited. "We have to maintain our competitiveness. This isn't going to change the pricing plan of our products," he said. A spokeswoman for Dixons confirmed the company was aware of the meeting, but said: "John Lewis themselves benefit from exclusive arrangements in other areas, so I would call this complaint frivolous." She added: "They [the OFT] did a comprehensive survey last year and I don't see that anything has happened in the last six months that would change that view." The Dixons Group owns Currys, Dixons and PC World.