Hop-On, the company that develops disposable cellphones has announced that it has entered an exclusive agreement, with a private London based corporation, which calls for a minimum purchase of 1 million of Hop-On's GSM phones per year, valued at more than US$25 million annually. The disposable phones will be distributed in the UK and Spain as part of the 3-year exclusive agreement.
Under the agreement, Hop-On will initially receive a US$1 million distribution fee, which will be used for general corporate operations. This agreement also gives Hop-On the opportunity to receive monthly recurring revenue in the form of a percentage of the airtime sold to consumers. Importantly, Hop-On will receive an irrevocable letter of credit to finance the manufacturing of the phones for overseas distribution in the fourth quarter.
The phones are currently sold in the USA for US$29.95, including 60 minutes of calling time. The phone uses voice activation on the network for dialing numbers, alleviating the need for a keypad on the phone.
The company did not say who would be reselling the "handsets" in Spain or the UK."
Posted to the site on 26th March 2002
Posted to: www.cellular-news.com/story/6237.php