Vodafone Sells 100,000 iPhones in First Eight Days of UK Sales

[ToroidalZeus]

Firstly, that's why Apple needs to step in and show a new UI that makes smaller touchscreens work. No-one has done it well yet so this would be the kick in the behind the market needs.

You can make a phone smaller but you cannot make the human finger smaller(figuratively speaking, I mean yes you could but ...) nor can you make people's eyes zoom in.

Secondly, wasn't it obvious I was talking about unsubsidised?

Most people really do not care about buying an unsubsidized phone. Which is why Apple negotiated the subsidy sky high. They rather get the 200 or 300 or whatever dollars in profit at the moment of sale v selling more unsubsidized cell phones.

 

[sapporobaby]

You can make a phone smaller but you cannot make the human finger smaller(figuratively speaking, I mean yes you could but ...) nor can you make peoples eyes zoom in.

1) Most people really do not care about buying an unsubsidized phone.
2) Like I said the price of the iPhone is Apples doing. They have made the unsubsidized price ridiculously high because of the huge subsidy they require. - I'd assume this is one of the reasons Verizon originally turned down Apple.

You are talking about the US right? If you are referring to Europe or other countries, the people there already know that there is no such thing as a $99 phone. Only Americans are dumb enough to believe it and fall for what the operators tell them.

 

[TastyOther]

Not quite correct either, O2 do support BBC iPlayer on 3G. However according to the BBC iPlayer is not available on Apple devices due to the Apple DRM, I don't know how DRM affects it but that's the official reason given by BBC. The strange thing is that you can access the iPlayer web page through Safari and watch the programmes there on your iPhone(though wi-fi is needed).

O2 might support it, the BBC do not - officially. The BBC consider the iPlayer via Safari entirely adequate (and having used it since 2007, I am inclined to agree). I haven't tested TV over data yet as I'm not in an area with 3G coverage, however radio over GPRS on Vodafone works fine.

DRM doesn't "affect" it, it is a legal/contractual issue, not a technical one.

In response to your other post: O2 very quickly changed their definition of data for the iPhone in response to exceptionally poor press coverage directly prior to launch.

This is not coming from a position of random "zealot" attitudes to phone providers, either. I've been a long term customer of pretty much all the main networks in the UK - Orange, Vodafone, Three (the worst by far, though I was an early adopter), O2 and T-Mobile. Data usage is important to me - I've been writing about cellular communications since the mid '90s when I was working on early digital photography and using a Windows CE H/PC and Option One GSM modem to transit images. O2 were better than Three in some regards, and that's the best I can say for them - they blocked ports, enforced caps and charged excessive amounts for data, and were near-impossible to get straight answers or end the contract with (constantly losing letters, and so forth, even when sent recorded).

I suspect that under those circumstances, they're no better or worse than other providers, but my experience with them as a provider AND as a customer service experience was so poor that even the iPhone would not tempt me back; I'm very pleased it's on Vodafone, but would have been happier with T-Mobile (who may well be officially offering the iPhone from March, following the merger with Orange).

Ryeno: The iPhone does not cost Apple "less than 200 dollars to make". That's the cost of the materials. Assembly, packing, shipping, regional taxes, stocking, R&D and so forth are not free, neither is marketing. Of course, if you provide your time for free, I've got a few building projects and some household maintenance that needs doing.

 

[ToroidalZeus]

the people there already know that there is no such thing as a $99 phone. Only Americans are dumb enough to believe it and fall for what the operators tell them.

Are you trying to say cell phones should cost more then 99 dollars? I agree the iPhone costs more then 99 dollars. But the point I was making is that the majority of cost per phone does not come from the cost to manufacture but the wholesale markup by Apple and the retail markup by the carriers.

R&D and so forth are not free, neither is marketing.

True but that fact still remains that Apple is making more than enough money to cover those expensives off the iPhone.

 

[TastyOther]

Are you trying to say cell phones should cost more then 99 dollars? I agree the iPhone costs more then 99 dollars. But the point I was making is that the majority of cost per phone does not come from the cost to manufacture but the wholesale markup by Apple and the retail markup by the carriers.

That's true of any device. Nikon make lenses that cost £1800 when Sigma produces something of similar specification for £800, and the retailers are probably paying near half that before taxes.

People gotta make a living. If you want a phone that costs 99 dollars, unsubsidised, then who is making money producing it? Bearing in mind that the bulk of the "material" cost of the iPhone is pretty similar (memory aside) to most handsets, yet the end device is very, very different due to Apple's research, design and so forth. You can only trim so much fat.

Unsubsidised iPhones are expensive largely because the retailers can get away with charging that much for them. If you want a genuinely expensive handset as an example, look at the Nokia 8800.

True but that fact still remains that Apple is making more than enough money to cover those expensives off the iPhone.

Define more than enough. They're making a profit. That's why they're in business (and frankly, that's why they're STILL in business). I don't see why a firm should reduce their profit margins just because it seems to an individual that they're making "too much money" - what sort of resentful attitude is that? Apple needs revenues, Apple's shareholders want profits, and Apple users want improved products that cost money to develop.

Apple is making enough money. There's no such thing as "more than enough" when it comes to profit; if people will pay for your product and it's very profitable, then well done - you'll either enjoy the profits until someone develops something better, or you'll re-invest and make something new to tempt them. It's a reward for thinking as well as making.

Do you also feel that people selling thousands of crappy apps that merely redirect to websites of other people's work are also making "more than enough"?

 

[ToroidalZeus]

If you want a phone that costs 99 dollars, unsubsidised, then who is making money producing it?

I really do not have a problem with buying a subsidized phone and neither do most people. The point i was trying to make originally with 99 dollars was that the iPhone device cost is already relatively inexpensive to the consumer. Considering most consumers do not care about contracts. So Apple making a cheaper iPhone is not really going to do anything.

 

[TastyOther]

Those two are not mutually exclusive.

I really do not have a problem with buying a subsidized phone. The point i was trying to make originally with 99 dollars was that the iPhone device cost is already relatively inexpensive to the consumer.

That depends so much on territory that it's a silly argument, unless you say "in the US" or "in the UK" or whatever.

You can get a free iPhone in the UK on some deals. I'm sure you'll have seen the old arguments about "OMG iPhone costs £1000!" because someone added up the cost over the life of the contract; people forget that as well as a product they're also buying a service.

My 32GB 3GS was £75 with a contract costing £40/month, which provides unlimited messaging, fair-use 1GB data (exceed it and don't get charged, but it isn't properly unlimited by my definition), and some insane number of minutes (I don't even know how many, 1200 or something). I thought that was pretty cheap.

Maybe I'm misreading your argument somewhere along the line, because it comes across to me that you think Apple should not be making so much money on it.

 

[ToroidalZeus]

I don't see why a firm should reduce their profit margins just because it seems to an individual that they're making "too much money"

You can get a free iPhone in the UK on some deals. I'm sure you'll have seen the old arguments about "OMG iPhone costs £1000!" because someone added up the cost over the life of the contract;

Maybe I'm misreading your argument somewhere along the line, because it comes across to me that you think Apple should not be making so much money on it.

If they lowered the subsidy than the carriers could in turn lower the cost of the device and the contracts that come with it. Apple would then in turns make more sales because more people could afford the iPhone (contract/monthly payments/device cost). But obviously Apple negotiated the deals this way so they do not want a cheaper iPhone. Which is the reason Apple making an iPhone nano is ridiculous because they could already lower the iPhone cost to take up a lower cost bracket.

 

[reverie]

The iPhone costs Apple less then 200 dollars to make. The price without subsidies is because Apple has driven a hard bargain and made all the carriers pay them a ridiculous amount of money per phone. Cost reductions permitting nothing, Apple can already reduce the subsidy it gets, if it wants the iPhone price lowered.

You're referring to the bullsh it figures from iSupply which of course have no clue what Apple is actually paying for materials and production as Apple has created several exclusive high-volume deals with its Asian suppliers.

But if we assume the numbers are reasonable--iSupply is estimating roughly the same $200 for several smartphones, like the Droid, the Pre or the Nexus, and none of them sell for less than ~$500 without contract. Equally ridiculous or a typical price point for a smartphone?

Obviously a big part of the cost of a phone are related to research, patents, hardware and software development, advertising and logistics. That's what Apple's 35,000 employees are doing all day. iSupply tells you nothing about that.

I do agree that the iPhone could be $100 cheaper by now, and I believe that Apple failed to drop wholesale prices when it released the iPhone 3GS last summer (according to their financial reports, the ASP for all iPhones went from $500 to $600). Apparently they were confident that the competition is too weak and decided to take some excessive profits this year.

The point is that the competition is not cheaper than Apple, and that's exactly what Tim and Steve have said several times their pricing strategy would be. http://news.cnet.com/8301-13579_3-10225484-37.html

 

[reverie]

If they lowered the subsidy than the carriers could in turn lower the cost of the device and the contracts that come with it. Apple would then in turns make more sales because more people could afford the iPhone (contract/monthly payments/device cost). But obviously Apple negotiated the deals this way so they do not want a cheaper iPhone.

I believe that the bottleneck today is not Apple's pricepoint, but the carriers' networks. About 10 % of AT&T customers now use an iPhone or similar, and their network in some cities is close to meltdown. I don't believe for a second that Verizon could handle much more. Give it a few years, and the networks will catch up, Apple will lower the wholesale price, and AT&T and Verizon will either give away the iPhone for free or (preferrable to Apple) lower the subsidies and bring the monthly cost down by $10 or $20.

An iPhone nano could have a plastic screen and a slower processor, for example. And it wouldn't have to focus on being cheaper, but on the form factor. Women and Asians (and I) want smaller phones. Apple will cater to them.

 

[ToroidalZeus]

Equally ridiculous or a typical price point for a smartphone?

The former. Apple set the bar with the iPhone so now everyone else can follow.

I personally would not be surprised if one of the reasons Verizon originally rejected Apple's deal was because of the high subsidy.

An iPhone nano could have a plastic screen and a slower processor, for example. And it wouldn't have to focus on being cheaper, but on the form factor. Women and Asians (and I) want smaller phones. Apple will cater to them.

and then everyone would be complaining about the cost being too close to the regular iPhone but the features and usability are beyond crippled. So you are better off just getting the regular iPhone.

As for women wanting a smaller phone. Most of them carry around relatively 'huge' handbags or purses.

 

[RandomKamikaze]

Wrong O2 have a true unlimited data policy on the iPhone and have had so since day 1, they made that very clear and have never charged on iPhone contracts for going over a data limit. If I switched from O2 to Vodafone I would be paying a lot more due to the data charges. It's also interesting to note that in early speed tests O2 has outperformed both Vodafone and Orange on their respective 3G networks.

As for O2 customer service, I have always found them to be very good and better than most customer services I have had the misfortune to have to access.

It is unlimited yes, but it is still Policed. People on the O2 forums have received emails and texts saying they have used too much data and to cut down.

Its built right into the T&C's as well. They don't set a limit, but use too much and they might slow you down or cut you off after trying to contact you.

Also, streaming content is not allowed under their T&C's

to allow the continuous streaming of any audio / video content, enable Voice over Internet (Voip), P2P or file sharing

BBC iPlayer is streaming, so use that and O2 have got grounds to cut you off, if I understand that correctly, especially as they don't define continuous

 

[Delta-NC]

Deleted.

 

[Back2Bedlam]

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[wolfie37]

Wrong. The O2 'Unlimited' data has always had a limit from day one. Unlike the other networks they just don't reveal their hypocrisy on the leaflets. (It's 1GB BTW)

WRONG!!! I've had an iPhone from day 1 in the UK (yeah I was one of those who queued at the Regent Street Apple Store on launch day. One of the reasons for going for it was the O2 unlimited data plan. I have never used less than 1GB of data per month, in fact I use over 10GB of data per month (although much of that is through Wi-Fi so doesn't count). I'm not holding up O2 as being the perfect company, far from it, but I am making comparisons to the rest of the market (and especially Vodaphone). In real use terms I don't know anyone who gets a cheaper deal than on O2 (one of the reasons why I have stuck with O2 over the years). Orange does have some tempting deals but not the reliability of coverage. As for contacting customer service, again I'm not going to pretend that O2 are perfect but on the (thankfully) infrequent occasions I have had to contact them I have always been treated politely and honestly. Recently I considered switching my broadband connection to them but they told me not to bother as my distance from the exchange would not give close to any of their advertised speeds, whereas the company I ended up going with happily accepted me and failed to ever deliver even a tenth of their advertised speeds.

With these kind of comparisons I go by real life experience rather than internet forums which can be skewed by posters who have axes to grind or who are employed by competitors.

 

[TastyOther]

whereas the company I ended up going with happily accepted me and failed to ever deliver even a tenth of their advertised speeds

Assuming, since you're talking about tech, in a tech-driven forum, surrounded by posters who potentially have a great deal more tech experience... assuming that you know something about technology...

Why on earth did you think that ANY provider would be able to increase the speed available? Given that the whole shebang is essentially managed by OpenReach and the wires from the exchange to your house are the same? Did you think that they'd have an exchange somehow closer?

I'm also very interested in how you're using over 10GB of data per month on an iPhone (and why you'd count your WiFi usage in order to claim that larger number). I used my T-Mobile contract as a substitute for broadband whilst waiting for OpenReach to fix the mess left by the previous Sky customer not paying their bills (I wanted to go to Be Pro - the speed is naturally the same, but they offer a better pricing structure for my usage; note that "limited" broadband is no use to me at this stage) - this was the usual workload of image desk and publishing work, including large advertising files and raw files from medium-format cameras, plus backing up changes to a >2GB website.

T-Mobile did not charge me, or restrict me, for exceeding my 3GB "fair use" allowance. They also allow modem/tethered use, and IRC/chat applications (excluded by O2; indeed back when I had a communicator on O2, actively blocked). The signal is excellent - far better than O2 or Vodafone here. That's obviously variable.

Anyway, it's great that O2 are good for you. It's also great that people now have the choice when they want an iPhone.

 

[ajreeves37]

Wrong

What are you talking about? Do you own an iPhone? When the 3Gs came out, people who had the 3G version were able to upgrade for free. Apple has stated that they will support free upgrades for 2 years.

Think before you type dude.

Wrong - You had to buy out the O2 contract AND buy the new 3GS. When the £G came out, you could upgrade then without buying out your contract.

Know before you type dude

 

[Schtumple]

Wrong - You had to buy out the O2 contract AND buy the new 3GS. When the £G came out, you could upgrade then without buying out your contract.

Know before you type dude

This is true, I was laughed at by a O2 rep despite them sending me an email saying I could upgrade to the 3GS from my current contract for free on any tarriff, I had to pay £180 for the handset, I dislike O2s tactics and would've loved to have gone with Vodafone...

 

[wolfie37]

This is true, I was laughed at by a O2 rep despite them sending me an email saying I could upgrade to the 3GS from my current contract for free on any tarriff, I had to pay £180 for the handset, I dislike O2s tactics and would've loved to have gone with Vodafone...

But this is true with any phone from any company; unless you have bought the handset upfront then you have to pay an upgrade charge if you want to change handsets before the end of the contract period. With the original iPhone the only way to get one was to pay upfront, therefore you totally owned the handset from day 1, therefore when the 3G came out you could upgrade straight away as you had no outstanding handset charge. The 3G contracts did offer the usual option of getting the handset discounted, or free, based on taking out a contract where the cost of the handset is paid off over the length of the contract(this is the usual model used by all mobile phone companies in UK). Therefore when the 3GS came out many people had still to finish off paying for their 3G handsets so could only upgrade with a charge. Again this is not unusual, this is the standard contract model used in the UK by all mobile phone operators.

 

[wolfie37]

Why on earth did you think that ANY provider would be able to increase the speed available? Given that the whole shebang is essentially managed by OpenReach and the wires from the exchange to your house are the same? Did you think that they'd have an exchange somehow closer?

I was getting a very poor service from my the provider, kept losing connection, sometimes getting no connection. When I decided I would transfer to O2 their customer service explained to me that as they used ADSL2+ my distance from the exchange was a limiting factor, however ADSLMAX would get me better speeds. This is refreshingly honest as they could have just taken my subscription. In the end I went with a company that offered ADSLMAX although I have since went with cable through Virginmedia.

So having a different provider CAN lead to different speeds depending on the system they use!

 

[sapporobaby]

Wrong - You had to buy out the O2 contract AND buy the new 3GS. When the £G came out, you could upgrade then without buying out your contract.

Know before you type dude

O2 is not the only provider in the world. Duh !!!!!

 

[wolfie37]

I'm also very interested in how you're using over 10GB of data per month on an iPhone (and why you'd count your WiFi usage in order to claim that larger number).

Well I monitored my data usage for a while, just out of curiosity. The app I used counted all data(including wifi) and I hit 10GB a couple of times, I don't know exactly how but I do know it was at the time that my home internet wasn't working reliably(at all). That did include a fair bit of iPlayer catch-up.

 

[TastyOther]

So having a different provider CAN lead to different speeds depending on the system they use!

ADSLMax isn't any sort of system. It's not a technology, it's not a protocol, it's a marketing term covering ADSL in various forms, as offered by BT/OpenReach. Did O2 recommend Be as a provider offering "ADSLMAX", by any chance? ADSLMax, or rather the products associated with it, pre-date ADSL2+ (ADSL2+ being generally associated with 24Mb service, though that's now offered with higher speeds through port bonding); it's tied in most packages to rate-adaptive 8Mb ADSL.

 

[wolfie37]

ADSLMax isn't any sort of system. It's not a technology, it's not a protocol, it's a marketing term covering ADSL in various forms, as offered by BT/OpenReach. Did O2 recommend Be as a provider offering "ADSLMAX", by any chance? ADSLMax, or rather the products associated with it, pre-date ADSL2+ (ADSL2+ being generally associated with 24Mb service, though that's now offered with higher speeds through port bonding); it's tied in most packages to rate-adaptive 8Mb ADSL.

O2 didn't recommend any provider. I had been with freedom2surf and had been getting speeds of around 2meg then after several buyouts there service provision dropped (frequent outages). They finally got bought by TalkTalk so that was time to move, O2 told me that because of my distance from exchange I wasn't suitable for their service and would get speeds of around 0.5meg, they used an analogy of 2+ being a thick tube which was easy to push lots of stuff down over a short distance, whereas MAX was like a thinner tube that had a bit more power behind it and was able to reach further distances. I ended up going with Plusnnet who were appalling(despite some very good reviews and knowing several people who are very satisfied with them). I went weeks at a time without any service, I did get 2.5meg for a couple of days then it disappeared again. As I say I'm now with Virgn and impressed with my speeds and service.

 

[Back2Bedlam]

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