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MacBytes
Apr 20, 2008, 07:23 AM
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Category: Opinion/Interviews
Link: Apple's iPhone a tougher sell in Europe? (http://www.macbytes.com/link.php?sid=20080420082355)
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Posted on MacBytes.com (http://www.macbytes.com)
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Jiddick ExRex
Apr 20, 2008, 07:44 AM
I am not surprised at this and would like to add something to the problem:
there is a whole other cell-phone culture in Europe than in the US. We are used to getting 1 € phones thrown at us and with the iPhone, the prices are MUCH higher than they are in the US.
For the price of the iPhone in Germany I could almost buy 3/4 of a macbook!!!

That is insane for such a small device and seeing that people usually get new phones once a year, it needs to be worth it. And it isn't for those people. So Apple is per definition hitting a very small market here, namely the ones who want to own a locked legit iPhone (which means expensive carrier, phone and no other options) and who do not care whether the phone breaks because they have the money to buy a new one immediately. That market segment is not exactly crowded here, not in Denmark anyway. :rolleyes:

OllyW
Apr 20, 2008, 08:26 AM
That story is from back in November, when the iPhone was released in France.

Apple seemed to hit the spot with with their sales plan for the USA. Unfortunately, Europe is a completely different market which Apple seems to have not understood.

T-Mobile in Germany and O2 in the UK have now started to discount the iPhone to try and get sales moving and clear out their stock. Let's hope Apple takes notice and gets it right when the 3G phone comes out this summer

nick9191
Apr 20, 2008, 08:39 AM
The iPhone sales have quadrooplified since O2 slashed the price here.

elppa
Apr 20, 2008, 07:27 PM
I definitely think Europe is a harder market to crack and this is Apple's first go with one handset, but they will get there with the right price / feature combination.

I'm not suggesting giving away the phones for free, but taking a bit off the handset price and a bit off the contract price will help. The signs are already good from O2s recent price reduction, we'll see how long this lasts.

There is certainly an appetite for the iPhone in Europe (along with the rest of Apple's products). Even though some of our phones have more impressive hardware specs, the operation of some of these phones remains quite a primitive experience and the build quality is often lacking.

I did also feel in the UK there was quite a high-profile campaign to slur the name/reputation of the iPhone. Papers printed stories such as “100 Reasons not to buy an iPhone”, TV News ran “My Grandmother can't use an iPhone” panic stories and a plethora of tech experts were trotted out one after another to deliver snide, backhanded comments and remind us all of the better (sic.) handsets available for free (sic.). And that was just for starters.

For the casual observer, it was easy to get the idea that the iPhone was all hype and no substance, or something extremely complicated and technical to use, far beyond the grasp of the average person on the street. Both of these ideas couldn't be further from the truth, but both have been factors in halting the adoption of the iPhone. In reality though the only phones which over-promised and under-delivered were the so called “iPhone Killers”, whereas the iPhone, despite it's well-documented v. 1.0 flaws, delivered a very captivating user experience.

Apple's playing on a big field with a lot of stake-holders who have an awful lot to loose should iPhone be successful, so they should be prepared for underhand tactics and devise strategies to cope accordingly.

Even though no where near as big as some of their rivals (NOKIA alone has 5x more staff), Apple is an incredibly shrewd operator and has both the talent, the product and the strategy to compete and win big.

Just don't be surprised if some carnage is left behind.

cheekybobcat
Apr 20, 2008, 07:40 PM
The iPhone sales have quadrooplified since O2 slashed the price here.

Price cut anywhere would cause this; especially in the US I would think. To me, it seems that more America is using/wanting the iPhone more then anywhere else. If a drastic price cut like O2 came out over here, iPhones would be impossible to get.

AlmostThere
Apr 21, 2008, 07:57 AM
I did also feel in the UK there was quite a high-profile campaign to slur the name/reputation of the iPhone. Papers printed stories such as “100 Reasons not to buy an iPhone”, TV News ran “My Grandmother can't use an iPhone” panic stories and a plethora of tech experts were trotted out one after another to deliver snide, backhanded comments and remind us all of the better (sic.) handsets available for free (sic.). And that was just for starters.


Subjectively, I didn't feel this at all. I am sure you can find plenty of negative coverage if you look for it but own lasting image is the (O2 funded?) and, for Apple in the UK, high profile TV campaign. Anyway, subjective impression.

If there is anything negative, it is not to do with the device, more to do with the sort of person who is likely to be seen with a iPhone. Nice phone but exclusively seen in the hands of merchant bankers.

BongoBanger
Apr 21, 2008, 08:14 AM
The iPhone sales have quadrooplified since O2 slashed the price here.

Mainly because it's now cheaper than the equivalent 8GB iPod Touch. Also, this rush won't last, it'll just clear the next tranche of buyers. I suspect a large proportion of them will jailbreak the phone too.

Oh for goodness sake!

I'm not suggesting giving away the phones for free, but taking a bit off the handset price and a bit off the contract price will help. The signs are already good from O2s recent price reduction, we'll see how long this lasts.

The problem here is that the lower you price the iPhone the less attractive the iPod Touch becomes. At the moment the 8GB iPhone is cheaper than the equivalen iPhone Touch and I'm not sure Apple can afford to squeeze margins much further.

There is certainly an appetite for the iPhone in Europe (along with the rest of Apple's products). Even though some of our phones have more impressive hardware specs, the operation of some of these phones remains quite a primitive experience and the build quality is often lacking.

And the iPhone lacks many features expected on fairly basic European 'phones. Your argument does indeed cut both ways.

I did also feel in the UK there was quite a high-profile campaign to slur the name/reputation of the iPhone. Papers printed stories such as “100 Reasons not to buy an iPhone”, TV News ran “My Grandmother can't use an iPhone” panic stories and a plethora of tech experts were trotted out one after another to deliver snide, backhanded comments and remind us all of the better (sic.) handsets available for free (sic.). And that was just for starters.

The exact same kind of articles were run in the US and it still sold millions. This is a total red herring.

For the casual observer, it was easy to get the idea that the iPhone was all hype and no substance, or something extremely complicated and technical to use, far beyond the grasp of the average person on the street.

No-one ever really thought that. The one thing people say when asked about it is that it's easy to use.

Both of these ideas couldn't be further from the truth, but both have been factors in halting the adoption of the iPhone.

Absolute nonsense.

In reality though the only phones which over-promised and under-delivered were the so called “iPhone Killers”, whereas the iPhone, despite it's well-documented v. 1.0 flaws, delivered a very captivating user experience.

The iPhone's sales in Europe are considerably less than, say, the LG Viewty or the Nokia N series. Since they mostly beat sales expectations your argument is incorrect.

Apple's playing on a big field with a lot of stake-holders who have an awful lot to loose should iPhone be successful, so they should be prepared for underhand tactics and devise strategies to cope accordingly.

Oh dear. Just... oh dear.

Even though no where near as big as some of their rivals (NOKIA alone has 5x more staff), Apple is an incredibly shrewd operator and has both the talent, the product and the strategy to compete and win big.

Quite possibly. It'll help if they stop making schoolboy errors when judging their markets though, won't it? Hardly the sign of a shrewd operator there!

Just don't be surprised if some carnage is left behind.

Or the iPhone is.

elppa
Apr 21, 2008, 10:09 AM
Oh for goodness sake!

Very patronising and condescending tone. I always try to respect your opinions, pity you can't extend the same common courtesy to mine.

The problem here is that the lower you price the iPhone the less attractive the iPod Touch becomes. At the moment the 8GB iPhone is cheaper than the equivalen iPhone Touch and I'm not sure Apple can afford to squeeze margins much further.

Apple would rather sell iPhones, so I don't think this will bother them.

And the iPhone lacks many features expected on fairly basic European 'phones. Your argument does indeed cut both ways.

Apart from MMS, I can't think of “many”, more than one feature basic phones have that iPhone lacks.

The exact same kind of articles were run in the US and it still sold millions. This is a total red herring.

I'm not so sure you can put it down to one factor. The iPhone was a better deal in the US due to:
[1] Less competiton
[2] Poorer/lack of 3G network
[3] More free wifi spots

amoungst other factors. I'm not saying this isn't the only reason the iPhone hasn't exceeded expectations in the UK, I'm just saying it may have been a factor.

No-one ever really thought that. The one thing people say when asked about it is that it's easy to use.

Your very confident on this and dismiss my argument out of hand — yet I have heard very different stories from people I have spoken to!

The iPhone's sales in Europe are considerably less than, say, the LG Viewty or the Nokia N series. Since they mostly beat sales expectations your argument is incorrect.

Both these were given away, for free, on any network. I don't think anyone expected iPhone 1.0 to outsell Nokia's entire range of smart-phones in Europe. The iPhone has been largely in line with O2s expectations as well, certainly not a failure. When I used the phrase “over-promised and under-delivered” I wasn't talking about sales figures, I was talking about customer satisfaction.

Oh dear. Just... oh dear.

It's naïve to think the 3 huge mobile operating companies, along with a number of large handset manufacturers aren't extremely worried about the iPhone. Don't believe their corporate press bravado!

Quite possibly. It'll help if they stop making schoolboy errors when judging their markets though, won't it? Hardly the sign of a shrewd operator there!

A shrewd operator is not one who doesn't makes mistakes, it is one who never makes the same mistakes again. Apple has as good track record of learning from errors in the past and putting them right.

Or the iPhone is.

That is one possibility yes, but one which I believe is unlikely, especially with the momentum the platform will have after June.

poor market strategy

I acknowledged that the price/feature combination hasn't been right yet.

over pricing

Again, I acknowledged this in my original post.

paucity of feature set.

I acknowledged the superior feature set on some competing phones as well.

I was making a prediction for the future not dwelling on the past.

BongoBanger
Apr 21, 2008, 10:48 AM
Very patronising and condescending tone. I always try to respect your opinions, pity you can't extend the same common courtesy to mine.

Tsk. Looking at your posting history respect for my opinions hasn't exactly been at the forefront, has it?

Apple would rather sell iPhones, so I don't think this will bother them.

A major revenue stream beign eroded won't bother them? Hmm...

Apart from MMS, I can't think of “many”, more than one feature basic phones have that iPhone lacks.

Removable batteries.

I'm not so sure you can put it down to one factor. The iPhone was a better deal in the US due to:
[1] Less competiton

Yes.

[2] Poorer/lack of 3G network

Kind of disagree here. 3G isn't as big an issue as it's mad out to be.

[3] More free wifi spots

Again not sure this is the case.

amoungst other factors. I'm not saying this isn't the only reason the iPhone hasn't exceeded expectations in the UK, I'm just saying it may have been a factor.

Very minor ones. Time and time again the key reasosn given are price and carrier lock in.

Your very confident on this and dismiss my argument out of hand — yet I have heard very different stories from people I have spoken to!

That's because I research rather than accepting anecdotal evidence. The Time awards and the Wall Street Journal articles state why.

Both these were given away, for free, on any network.

Incorrect. The N95 cost between £100 and £150 on launch for a similar contract to the iPhone. The Viewty was generally free, however.

I don't think anyone expected iPhone 1.0 to outsell Nokia's entire range of smart-phones in Europe.

It didn't outsell the flagship N95 model which was its direct competitor. This includes figures being adjusted for length of time on the market.

The iPhone has been largely in line with O2s expectations as well, certainly not a failure.

Marketing speak for 'missed target'. We have actual figures from Orange France showing the iPhone missed expectations. Given the evidence from the UK and Germany it is reasonable to suppose the situation is the same there.

Of course, the price cuts will boost sales but it's a short term measure.

When I used the phrase “over-promised and under-delivered” I wasn't talking about sales figures, I was talking about customer satisfaction.

Ok.

It's naïve to think the 3 huge mobile operating companies, along with a number of large handset manufacturers aren't extremely worried about the iPhone. Don't believe their corporate press bravado!

I think Apple or definitely on their radar, however I don't think they're having sleepless nights yet.

A shrewd operator is not one who doesn't makes mistakes, it is one who never makes the same mistakes again. Apple has as good track record of learning from errors in the past and putting them right.

I would hope so otherwise it's going to be a horrible market for them.

That is one possibility yes, but one which I believe is unlikely, especially with the momentum the platform will have after June.

Perhpas. Time will tell.

philippott
Apr 22, 2008, 04:21 AM
The iPhone's sales in Europe are considerably less than, say, the LG Viewty or the Nokia N series. Since they mostly beat sales expectations your argument is incorrect.

I truely wonder why the N95 does so well - having had one and being remembered every second during its usage at the very first crashy Nokia Communicator. Never ever again since this time I had another Nokia product crash so often like the old 9000. The keys are bad, the GPS accuracy changes between 20 meters and 1700 meters by walking 20 meters on a soccerfield-sized wide area under the blue skies, the internet browser constantly crashed, the phonebook crashed, when the phone rings pulling it out of the pocket gave me a 30% chance to kill the call by turning it off with this silver-ring-key on the front, and such.... The worse device ever build. Geekwise it is great, has quazillion features, but buildwise it is really bad.

Many people I know here in Austria, Vienna, are grownup adult Toy-Kiddies - meaning has to have the latest and greatest cellphone to play around for a while, then the device is back down to its most basic use: making and handling phonecalls. Of all the "100" people I know (family, friends, mid-sized customers, online-friends, ...) just 2 use their phones to sync with Outlook for calender, contacts and the like. But all the other "98" phones would support it as well!

People used to change phones gratis or for few EURs once a year, now it turned to every 18 months due to increased standard contracts.

I dont know anybody who uses video-phoneing here. Video-phone-minutes are still way-to-expensive compared to the 400/500/1k/X free minutes. Also the concept lacks interest, who cares usually to see where the other one is, and vice-versa, especially with the low-res cams & screens of a cellphone? OK, video-conferencing for businesses is different, but then people are seated in a room, and usually use a stationary VoiP/Video system.

People who need internet-to-go usually buy a PCMCIA-cards+gsm subscription for their laptops and the come in all flavors and pricing categories. Some Laptops have the GSM slot builtin already and you simply buy a GSM data SIM. Of all the business people I know none uses his or her normal cell phone as a bridge to the internet for their laptops, they all use seperate GSM-PCMCIA cards.

Reason for myself why I dont have an iPhone is the ridicoulous high price, and the un-availibility of it for my t-mobile.at businesscontract. USD-EUR is 1.5 since quite some time now, since longer than the inauguration of the iPhone here, but we have to pay a 1:1 ratio price.

The sole iPhone user I know here uses it to listen to music and for phone calls. I had a SE K810i myself some time and this played music as well, for a quarter of the price :-)

So, except for a very small amount of people, people use cellphones with 100+ features for just 3 functions: making and receiving calls and listening to music (music being the most used 3rd function, I m sure). The rest of the functions is lost in the digital void.

The iPhone could/can change this ratio, but (here) it needs to be cheaper, thrown into your Eduscho-Coffee-Beans-Bag or being sold for 0-now-money at disconter-supermarkets, or regarding my t-mobile businesscontract being added to the range of cheap-upgrade phones.

Regards

needthephone
Apr 22, 2008, 04:36 AM
Simple, I (and plenty of people did in newspaper articles, news items etc) could have told apple this when they launched.

It's not yet 3G and so is seen as (and frankly it is) old technology. Its too fundamental to ignore and the gorgeous interface can't offset this basic fact. It is seen as intrinsically out of date.

3G then it will go into orbit.

It's why they didn't even launch in Asia and Australia. Everyone would have laughed at it.

I desperately want an iphone but it MUST be 3G.

On the subject of crashing Nokias-I have a 6280 and its very buggy and would never get Nokia again

BongoBanger
Apr 22, 2008, 06:24 AM
I truely wonder why the N95 does so well - having had one and being remembered every second during its usage at the very first crashy Nokia Communicator. Never ever again since this time I had another Nokia product crash so often like the old 9000. The keys are bad, the GPS accuracy changes between 20 meters and 1700 meters by walking 20 meters on a soccerfield-sized wide area under the blue skies, the internet browser constantly crashed, the phonebook crashed, when the phone rings pulling it out of the pocket gave me a 30% chance to kill the call by turning it off with this silver-ring-key on the front, and such.... The worse device ever build. Geekwise it is great, has quazillion features, but buildwise it is really bad.

I'm sorry your personal experience was bad. It's worth pointing out that Nokia addressed the instabilities in the v11 firmware updates and the GPS inaccuracies in the V12 and v20 firmware updates. It must also be stressed that the N95 has very high customer satisfaction rates although it's obviously not going to please everyone.

One has to ask the question though: if you didn't want a gazillion geeky features then why not just get a, say, N73 or an SE Walkman phone?

philippott
Apr 22, 2008, 10:14 AM
One has to ask the question though: if you didn't want a gazillion geeky features then why not just get a, say, N73 or an SE Walkman phone?

The SE Walkman phone was a 4 months experience, and not my own phone. Aside from solid phone performance it has a good camera and plays music well.

But then three months ago I felt unhappy with the candybar cellphones in general and my default work 6233 Nokia in particular (because of the screen backlight). So I got the laying-around-in-our-office N95 for a testspin and used it 3 weeks.

Considering I used the extra features of all these phone few to no times and because of the unavailibility of the iPhone at the time and its high price I started to look around. I came across the UMTS Motorola K3 and since then I m happy with it. Receiving a call is easy, just flipping it open - closing a call as well simply by closing it. It plays music fine while walking with the dog. I also value the reminder feature and the handy 1-button for viewing recent activities. It never crashed on me, people can say the Motorola Menu is old, but it works (fast). Opening maps.google.at and entering a vienna address works too, although tiny, but still I get to the places :)

Another option I was considering was the Nokia E51, but I thought I would run again into backlighting issues, and I wanted to have a clamshell phone to handle phonecalls differently/easier.

Regards