Though anecdotal evidence suggests that the iPhone’s launch in Europe has met with less-than sizzling reception, the picture is actually nowhere near so clear.
Colleagues at Wired, for example, cite self-reports from O2 and T-Mobile of Germany that claim that the iPhone launch exceeded their expectations dramatically with sales in the “tens of thousands.” On the other hand, BusinessWeek notes with distress that it’s actually impossible to get a business contract for the iPhone in the UK at the moment — it’s only available on consumer service plans.
Jake, a Cult of Mac reader from the UK, however, seems to sum the general vibe up nicely (he practically duplicates the exact frustrated phrases my friends in the UK have):
I live in the UK and I agree that there was several stores across the country that were empty. There is one reason for this. Price. Whilst the cheapest contract in the states is $59 per month the cheapest contract here is £35 per month. Because of the exchange rate it works out that were paying $78 for the same contract as you. although this is not much more it is still quite alot for what you get. Also the price of the 8GB iPhone here is £269 and in dollars it is $566 where as you guys are paying $400.
These issues are common, of course. Everything from the Xbox to the PS3 is dramatically more expensive in the UK and Europe. However, when there are lots of phones (some of them REALLY good), it’s harder for the iPhone to make the same sort of premium play. In the UK, everyone is used to free phones with long service plans or paid-for phones with no contract. Apple’s not coming correct, especially since the iPhone has no 3G data, a nigh-unforgivable sin in ultra-connected Europe. Very interesting developments. Will Apple make a serious international foothold, or will they be as provincially North American as the BlackBerry?
Technorati Tags: europe, iphone, mobile
36 responses to “Confusion In the Streets Over Euro iPhone Launch”
Where did this notion of all Europeans needing 3G come from?!!?? I think one influential person posted it somewhere visible when the iPhone was announced and now its been repeated over and over until the point that everyone thinks its true! Heres the deal – hardly any UK consumer even knows what it means to be 3G!!! And certainly they wouldn’t be able to tell you the advantages of having a 3G phone or even if the one they own has one! I lived in the US for 4 years until Jan and work on the technical side of the wireless industry (so I have a bit of experience in both markets) and I feel a bit sorry for Apple as all the opinionated reports have created a public opinion about the iPhone which is unjustified, rather than public opinion creating the reports. I have yet to meet anyone who has a major issue with the iPhone data speeds.
However, price is another matter… I got mine for 230GBP with shipping and unlocked and now use on T-Mobile UK with a 7.50GBP unlimited data plan… who can beat that? I would still do it if the phone cost me 400GBP. I struggle to see how Apple selling the iPhone unlocked and for a bit more would not increase ownership and therefore their turnover. Let the networks subsidise if needed!
The good news for Australia out of this is that it might make Apple hurry up and release the 3G version down here.
The bad news is they said it would be ages before they release the 3G version
The good news is it is bound to be on a Telstra network (good news? it had to fit the theme)
The bad news is we won’t even have wireless iTunes store downloads at starbucks
The good news is we won’t have to drink starbucks coffee
The bad news is we pay through the nose like the UK. Have a look at the exchange rate!!!
The good news is we will be waiting years anyway if it is anything like the iTunes store(good news?again it had to fit the theme)
The bad news is we don’t even have print services here from iPhoto – come on print@fujicolour!!!
The Blackberry is quite a common sight here in London; probably one of the more common phones. But this may be due to the fact that Blackberries are more used for business purposes. As for the iPhone pricing, the same can be said for Mac and iPod pricing which is also much higher here than in the US when using current exchange rates. However, the mac and iPod sales are very strong in the EU, implying that pricing is not the main factor. I believe instead that the lack of 3G support, the availability of good competitive products are more important factors. Additionally, buyers in the EU may be holding out for the next gen iPhone which hopefully will support 3G.
The comparison is not as straitforward, because in the UK and in Europe people receive their salaries in GBPounds and Euros.
I definitely think demand for the iPhone has been underwhelming in the UK. Last Friday evening I met desperate O2 sales staff hawking for business as I walked through the mall in Welwyn Garden City. They were waving iPhones at unimpressed commuters as they headed home. The O2 store was practically empty. Now admittedly Welwyn Garden City is hardly a cutting-edge metropolis, but I work in advertising in London and only one of friends has bothered to get an iPhone. You’d have thought we’d be the ideal target market.
I understand that the focus for Europe is the UK and not Germany but over here sales are really sluggish: I just visited a T-Mobile store in Düsseldorf and they sold five (in numbers: 5) iPhones so far.
Over here T-Mobile asks for roughly the same plan price (EUR 50,-) but grants only half the minutes the Brits are getting and less than one fourth of the text messages. This was of course the only reason for T-Mobile to delay announcing the plans when they presented Steve and the iPhone in Berlin straight after London. The plans just look to outrageous.
I think in the end most users will benefit from T-Mobile’s greed: Other carriers will take this as a clear sign that stepping over the border and trying to charge rates that can only be called unethical will fail even the most revolutionary device on the planet.
Over here in the UK, Blackberries are now the standard business phone. So even if the iPhone does become available on O2’s business tariff, it’ll take a lot to ask for those customers to give up their black habit. I don’t know how it works over there but here new mobiles always half in price six months after they’re launched. How can this happen with Apple? Their old products cease to exist once a replacement has been released.
Wait a minute there, Jake. For £35 you get 200 minutes and unlimited data, including hotspots, which are ubiquitous in the big cities, and almost non-existent in the US. For £10 more, you get 600 minutes. For the same £35 you get 600 minutes on a smartphone and limited data service. In the states that $60 US plan (£28) gets you 450 minutes and unlimited data, but not many hotspots. For the same 60 bucks you can get 900 minutes, or 600 minutes and data.
So it’s not actually the iPhone service that’s expensive in the UK. It’s all mobile services. It appears that the services-for-price comparisons are roughly equivalent, within each country.
Nothing to do with price plans in the UK (although the iPhone one comes up about 300mins a month shorter for similar). Until iPhones are free with your contract (or a helluver a lot cheaper) and they’re 3G, then it’s not gonna do anything over here. Everyone’s saying that. And no one’s buying it.
Also, UK contracts are “receiving party pays”, which means you don’t end up using precious minutes on receiving calls.
From the people that have said they’d not want it, it’s not the cost of the phone, it’s that you don’t get enough free texts per month of all things.
I have a feeling then that the iPhone will have limited success in Australia, too. Nearly all fancy phones are available through all the various carriers as $0 for the phone + your monthly service charge (generally on a 24 month contract), and unless there is something similar I don’t think the sales will be amazing.
The fact that it’s not 3G is also disappointing considering people are also starting to move on from that.
I ended up getting an N95 over the iPhone.
£269 + £45 a month (that’s the only reasonable tarrif with a suitable amount of text messages) was just ridiculously over priced.
At the same time, Orange offered me an N95 for free on a £25 a month tarrif with 500 minutes and unlimited texts. It ended up being a no-brainer for me.
@Stuart – Texting is a big issue here. We text far more then we phone. And the iPhone is designed to turn texting into IM, this encourages us to use far more texts.
Finally it comes down to comparisons. when you are paying nearly £50 a month for a phone you do not expect to have to pay for the handset in the UK. There is too much competition for this.
I watched the Keynote, I read the write ups and rumours, I watched the US release and I am a dyed in the wool MAC User. But I will NOT pay the extortionate price asked for the iPhone in the UK. It baffles me who would.
Apple in their infinite wisdom have tried to break a tried, tested and succesful market economic model. No supplier in the UK charges a whole load of cash for a phone, then asks for a whole load more for the contract and even more puzzling restricts sales to one major outlet.
Hats off to Apple for producing what will no doubt be another iconic product, but they are fools to buck a successful marketing pattern for one of their own, and one based solely on financial greed.
I predict within 12 months the iPhone will be following the same market as all other handests here in the UK … Pre pay and available everywhere.
Good Luck Steve … you’re gonna need it.
@gbomb: I tend to agree that your average customer couldn’t care less about being 3G. However, the iPhone specifically tries to appeal to the “always online” crowd and these are the people who Apple tries to appeal to with the product.
Your average customer will just start laughing if you show him an expensive phone bundled with a contract that charges more for per minute than any pay-per-call contract out there (at least over here in Germany).
I find it hard to believe that Apple seemed to forgot that they are trying to appeal to technically literate customers. Generally these people tend to compare features carefully. If you overstretch on the price side they will walk away.
So, you have to pay for the handset in addition to signing up for the contract? Is that right? If so, :(
iPhone in Germany – I sat down and did the math. My wife and I have no landline, we only have the mobile phones. We currently pay EUR 50 per month. We’d love to have iPhones. The rates offered by T-Mobile are so bad that we would pay between EUR3700 to EUR4400 more over two years than we would with the current plan – depending on which of the three rates we would take. Per month that’s about EUR180 more than the EUR50 we are paying now.
It is sad that this pricing is making it cool not to have an iPhone…
By the way, EUR 4400 = $ 6500. Wow. I’m not kidding.
Comparing iPhones to other phones is (pardon the expression) comparing apples to oranges. WHat you get for £299 is a top-notch mobile AND an iPod touch. That’s £100 for the phone. Try as I might, I couldn’t find a page on the UK mobile provider sites that actually quoted the proce of a phone, only monthly charges. A few phones were free, but without many features. The cheapest monthly plan was £9 – for a low-end phone) which over the life of an 18 month contract will cost $135. Added to the iPod touch, this option costs more. CFully featured phones cost a good deal more, plus you need to find service for iPod browsing.
Don’t get me wrong, i think the iPhone is expensive, but it is a very good value. The real rip off for any mobile phone is the service. It’s like Gillette and their razor blades. They gave away the razor, but made a lot of money selling the blades. The other comparison is ink jet printers. Those things are dirt cheap (£32 for an all-in one on Amazon), but you pay through the nose for ink cartridges. Same for the mobile services. The plans are deliberately confusing, the tariffs are too high, and they sucker you by giving you a much better phone than you would normally buy outright. In fact, they’re as much like a car dealer as Gillette. Q:How much is this car? A:How much can you afford a month?”