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Evidence of poor European sales?

BongoBanger

BongoBanger

macrumors 68000
Original poster
Feb 5, 2008
1,920
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There has been some speculation that iPhone sales in Europe have been less than anticipated. Although there have been few official figures released, a number of things seem to point towards this:

  • 02's increased plan allowances
  • T-mobile's price decrease in Germany
  • The documented poor sales in France

The link for the French sales is here:

http://www.macworld.co.uk/news/index.cfm?newsid=20889

Although we know there is intense specualtion over a new model being released I'm not sure that this accounts for 02's actions (it's also interesting that 02 have cut iPhone advertising from their main shop window displays) or the poor French sales, which were measured over November to end January.

I'm also not convinced that adding 3G is going to make that much difference. Sure, it's a nice feature, but is it really responsible for us Euros holding back? I'm more inclined to look at the price and restrictive carrier business model. Bottom line is that I get the feeling that unless Apple really get to know the European (and Asian) markets a bit better they're going to struggle in these markets.

Thoughts?
 
The tarrifs are too high and a SIM free option must be introduced or a PAYG.. ofcourse the sales will be terrible when they dont listen to what the customer wants..

Now the customers are trying to tell apple how they feel by unlocking via JB and apple are not getting the hint so sales will be bad when they dont know that:

THE CUSTOMER GETS WHAT HE WANTS...

The fact of them increasing plan allowance doesnt make the contract less expensive.
Tmobiles price decreased to get rid of 8gb for a 3g iphone
 
You have to understand the populations of people in europe are smaller so the numbers of phone sold will be also. The iPhone is very expensive and the plans are higher then a normal smart phone for these customers.

I think selling 1/2 million in the UK is outstanding considering they are use to getting the phones for free with a contract and all europeans have been brain washed into thinking if a phone is not 3G its not worth having.

Look at what O2 charges people in Ireland for an iPhone... the cost of service is out of sight!

Just wait until Japan gets a hold of the iPhone- the 10 million goal will be nothing when they can sell the phone there.
 
TXCraig said:
I think selling 1/2 million in the UK is outstanding considering they are use to getting the phones for free

Just wait until Japan gets a hold of the iPhone- the 10 million goal will be nothing when they can sell the phone there.
Click to expand...

10,000,000 iPhones is a sure bet

4:1

any takers :)
 
Just way too expensive (phone + contract, etc) - I've honestly lost count of the number of people who've said they'd love to get it, they can afford it, but they have no intention of paying that kind of money. It's nuts. And the O2 deal in Ireland is, I think, the biggest rip-off in Europe.
 
I don't think the 10M phones is necessarily in that much jeopardy. And I don't see this as evidence of a rushed 3G iPhone. With the battery life of the 2G iPhone already not being fantastic, a rush job 3G is going to be teh sVXX0Rz.

Apple will have to respond to customer demands, and they're eventually going to have to offer 3G. They shouldn't give up on Europe, and I don't think Europe is uncrackable.

But they also have lots of room to continue growing in the US market, which is plenty lucrative, and relatively satisfied with EDGE. Particularly Sprint seems like a very lush field to pick up converts from.

Plus they really ought to hedge their Europe bets by continuing to aggressively pursue other, less jaded markets. And by less jaded, I do not mean Japan or Korea. :p
 
TXCraig said:
You have to understand the populations of people in europe are smaller so the numbers of phone sold will be also.

Just wait until Japan gets a hold of the iPhone- the 10 million goal will be nothing when they can sell the phone there.
Click to expand...

Not that much smaller populations than the US.

UK, Germany and France combined are about 207 million alone compared to about 303 million in the US. The EU as a whole is 497 million people!

Japan has about 127 million inhabitants. And from what I have seen of the Japanese mobile market it is not going to be easy there either.
 
TXCraig said:
You have to understand the populations of people in europe are smaller so the numbers of phone sold will be also.
Click to expand...

:confused:

You should have Wikipedia-ed first!

"In 2005 the population of Europe was 728 million or 11% of the world population."
 
TXCraig said:
You have to understand the populations of people in europe are smaller so the numbers of phone sold will be also.
Click to expand...

As has been pointed out, the combined population of France, Germany and the UK is about two-thirds of the US. I appreciate that it's only been on sale for about half the time but you would expect better sales figures - say, 1.5 milion - than have been generated if it was just a numbers game.

The iPhone is very expensive and the plans are higher then a normal smart phone for these customers.
Click to expand...

Uncompetitively so.

I think selling 1/2 million in the UK is outstanding considering they are use to getting the phones for free with a contract and all europeans have been brain washed into thinking if a phone is not 3G its not worth having.
Click to expand...

First of all can you give me the source that shows 500,000 iPhones have been sold in the UK. Secondly, we don't get all our phones free with contract although they are subsidised (I payed £50 for my N95, for example). Thirdly, we haven't been 'brainwashed' as 3G isn't the main reason for non-adoption - those would be price and carrier lock in.

What you need to understand - and Apple for that matter - is that the European market (and it's actually a hot potch of different markets) is radically different from those of the US. A 3G iPhone will not change this.

Look at what O2 charges people in Ireland for an iPhone... the cost of service is out of sight!
Click to expand...

I know. More idiocy on the part of 02. Vodafone must be pissing themselves laughing now.

Just wait until Japan gets a hold of the iPhone- the 10 million goal will be nothing when they can sell the phone there.
Click to expand...

The assumption is that mainstream Japan will be interested in the iPhone. Given their mobile develpments I kind of doubt it's going to make a huge impact.
 
Missing fact

One thing that I have not seen in this thread yet is the fact that a lot of Europeans are buying their iPhones in the US. The main reasons being the unavailability in most EU countries and the large price/value difference due to the weakened dollar.

I know almost a dozen people who all got their iPhones stateside and I'm planning a trip myself to buy not just the iPhone but an MBA as well. If you buy enough kit, you could even get the plane ticket out of it (if not more).
 
diplo0 said:
One thing that I have not seen in this thread yet is the fact that a lot of Europeans are buying their iPhones in the US. The main reasons being the unavailability in most EU countries and the large price/value difference due to the weakened dollar.
Click to expand...

I agree with this. The other reason is they can jailbreak it and use the carrier of their choice in the countries that do offer it This is an attractive option for many people so, whilst official sales may be disappointing, there is certainly a shadow market for the iPhone. However, no-one really knows how big it is. Worldwide it may be a million or more (the difference between AT&T's subscriptions plus known Euro sales and Apple's shipments) but we don't know how many have been sold per region.

As for the iPhone being a huge success in the UK, I've yet to see evidence of this in terms of sales volumes. In fact, most analyst estimates put it at the low end of projected volumes and we know that 02 had to make their tariffs a lot more attractive to improve business.
 
Certainly, I think lack of proper Bluetooth, 3G, a camera flash and MMS all hold back European sales a bit.

But not nearly as much as the fact it's just too damned expensive.

If the tarriff is going to remain at at least £35 per month in the UK for example, then Apple need to drop the price of the handset to at most £100. Otherwise they're just not going to make any progress.

I doubt phone locking is actually making that much difference - lots of phones are networked locked out of the box and no one really cares. But the perception that you're paying a significant tarriff and not getting any better deal out of it (and the existance of the iPod Touch at the same price proves that to customers) on the handset upfront just makes the thing look staggeringly uncompetitive.

Phazer
 
O2 improved their tariffs across the board, I understand, not specifically for the iPhone. The price differential between the iPhone and its competitors still remains.
I know of two people, who bought an iPhone. One is a newly baked Apple freak who buys every single model of iPod available. The other has contacts within O2, got a good deal on the phone and still has buyer's remorse and wants to return it.
In public, I have not seen many iPhones around. I think the buzz lasted all of five minutes. I doubt that true sales are even at the bottom of expectations for the UK, let alone "doing well", whatever Apple's spokesliars may put out. Most mobile phones in the UK (80%+ I remember reading) are PAYG, so Apple had its work cut out from the start.
 
weckart said:
Most mobile phones in the UK (80%+ I remember reading) are PAYG, so Apple had its work cut out from the start.
Click to expand...

Really? I doubt its that high.

The main 2 reasons the iPhone isn't doing well is that it lacks 3G and has no contract for £25/month, which is the sweet spot.
 
Eraserhead said:
Really? I doubt its that high.
The main 2 reasons the iPhone isn't doing well is that it lacks 3G and has no contract for £25/month, which is the sweet spot.
Click to expand...

Statistically currently around a quarter of mobile phones are used to access the internet, so the lack of 3g is not going to be the major factor in the UKs reluctance to embrace the iphone.
It simply is too expensive to have to pay for the phone and a high 18 month contract even for a high end phone. Make the iphone free on contract and it would sell out.
 
senorFunkyPants said:
Statistically currently around a quarter of mobile phones are used to access the internet, so the lack of 3g is not going to be the major factor in the UKs reluctance to embrace the iphone.
Click to expand...

We don't have EDGE, or at least only have a very poor EDGE network, and have had 3G phones for 3-4 years now.
 
Yea the iPhone isn't doing to great here. I haven't spotted any in the wild too.

What they really need to do is subsidize the iPhone, or reduce the cost of the contracts but with the same minutes/texts. Add 3G (the horse is dead already) since every other phone has it. Better camera (give it enough welly and it'll be my new P&S camera).

PAYG option. Although some features like Visual Voicemail won't work on other networks.

But really I'm just echoing what everyone else is saying. Hopefully (yea right) if enough people speak up Apple and o2 might change some things around. They've both made changes to the iPhone already, after all.

I'd also just like to say none of my friends are considering an iPhone because it lacks 3G. Of course its not everyone in the UK but it shows that some people would really like a 3G chip in there.
 
Eraserhead said:
Really? I doubt its that high.
Click to expand...

It's actually about 65-70%. The big carriers removed a lot of the subsidies from PAYG phones a few years ago to try and stimulate contract growth with limited success.

The main 2 reasons the iPhone isn't doing well is that it lacks 3G and has no contract for £25/month, which is the sweet spot.
Click to expand...

I partially agree. The main reasons I think are price and carrier lock in. The unit is too expensive at £269 and there is no £25 contract - not unexpected given the unlimited data download facility and, in fairness, not uncommon for similar phones. Comparatively, an N95 would be between free and £10 for the same contract with T-mobile UK or on 02 it would be £100 for the N95 8GB. You can't shop around for an iPhone, well at least not legally. ;)

3G I'm less convinced is a big issue. I think more people would be bothered by no MMS or video recording than this.
 
diplo0 said:
One thing that I have not seen in this thread yet is the fact that a lot of Europeans are buying their iPhones in the US.
Click to expand...

I'd be really curious to see numbers on grey market iPhones. There's that Chinese claim that there are 600,000 activated iPhones (not including knockoffs, I think) in China. That seems a little hard to believe. But the numbers, I think, suggest that somewhere between 15-25% of iPhones in the US are not activated on AT&T, meaning presumably that most of these phones are either activated on T-Mobile or another US GSM carrier or leave the country.
 
How do you buy phones in the US? Do you pay for the phone and the contract? Over here the phone is free, and is included in the price of the contract. Except with the iPhone, hence why it hasn't sold brilliantly. Apple love to rip off Europe, and we've just turned round and said stuff it, so looks like there going to have to reconsider some things.

Over here the phone itself costs £269 (over 500 USD :eek:) whereas pradas, viewtys etc. are all free.
 
nick9191 said:
How do you buy phones in the US? Do you pay for the phone and the contract? Over here the phone is free, and is included in the price of the contract. Except with the iPhone, hence why it hasn't sold brilliantly.
Click to expand...

It's the same (it's funny, because in the past, Europeans on MR would constantly complain about the American market's insistence on subsidized phones and the European preference for carrier-less ones, while conveniently failing to mention the rapid shift in Europe to match the system in the US. :p ).

Basically, 90% or more of new phones aside from the iPhone are purchased subsidized on contract. The price ranges from free on up, depending on the phone and the promotions at the time. There are pretty much always free phones, including some fairly good ones, with all the carriers. But not all subsidized phones are free (which I think is also a more accurate way of depicting the UK market?).

The other (guessing on size) 5-10% is composed of unlocked, and almost invariably grey market phones. And then of course there are used / private sales, e.g. eBay, which contain a mix of locked and unlocked phones, the majority of which were previously purchased on contract.

The iPhone is an exception -- the phone has to date been sold at fixed, unsubsidized prices, without a contract, but activation with AT&T requires signing the contract. It started at $599-699 and has wended its way down to $399 (and as little as 199 for refurbs). Typically an "It" phone like that from another vendor on subsidy would have cost $299 with contract very briefly at launch and quickly settled down to around $50-99. Which sounds like it's more in terms of phone cost than the UK situation (the best smartphones rarely come all the way down to free -- like getting a Nokia N95 for free, even a few months after launch, would be less common here), although I think in the balance, long term, stable usage customers in the US do just as well or better. It sounds like your pay-as-you-go situations are better, although to be honest, I have not used US PAYG in years -- I used it on my first phone briefly about 10 years ago.
 
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