John Lewis rebuts OFT PC findings

The John Lewis Partnership presented fresh research to the Office of Fair Trading in a continued attempt to prove exclusive distribution deals between high street stores and PC manufacturers restrict consumer choice.

The chain has been vociferous in its objection to exclusive supply deals, as struck by Dixons with Compaq and Packard Bell.

But the OFT, which gave the PC market the all-clear last October, maintains that the deals do not contravene competition policy.

John Lewis will attempt to use the results of the research conducted on its behalf by Taylor Nelson Sofres to argue that the definition of the PC market used by the OFT in its investigation was flawed.

The OFT understood it to include Internet, direct order and high street sales in reaching its conclusions. It claimed that Dixons Store Group, including Dixons, PC World and Curry’s, had less than 25 per cent of the PC market despite an exclusive supply deal with Compaq.

But John Lewis’ research suggests 55 per cent of potential purchasers want services which are only provided on the high street. John Lewis will argue that many consumers would not consider buying a PC over the internet or through direct order, and so high street retailers should be seen as a separate market.

John Lewis will claim that under this definition, DSG has a 57 per cent claim in the PC retail market, and that this monopoly would only be strengthened through further exclusive supply deals.

A John Lewis spokeswoman says: “The arguments in the research are compelling. We want the OFT to suggest to Packard Bell that it doesn’t cease supplying John Lewis on 30 July, but waits until the OFT has looked at the issue again.”

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