MSE News: Orange deal sparks iPhone price-cut hopes

gjchester

gabbyevs wrote: »

good news all round then it about time o2 had some competition

You know I don't think thats the case at all. All the networks offer a very similar range at a very similar price apart from 3 who are basically hoovering up the budget market.

Take a new phone heavily pushed phone Nokia's N97 (picking that as it's new and not exclusive to any network). Taking a £30 tariff for 18 months and all networks are charginging £220 to £240 for the phone.
To get a "free phone" on a 18 month contract you need to sign up to a £75+ tarrif. Three is a lot cheaper but not many people rate the network.

Taking something more basic like the LG Cookie and the costs come down but to get a "free phone" the line renatl is still £20 to £25 minimum.

There is very little effective competition in the mobile market. The basic prices and plan of each company are so similar it's hard to see any competition is happening, most people don't need 60 minutes on a mobile a month as they use it for really quick calls when out. Apart from Three everyone does huge bundles in the cost, it looks good value until you think most people pay for minutes they don't use at all. There are the best value but almost everyone has heard horror stories about three.

Another example is the contract length, it's now almost impossible to get a 12 month contract on a new phone, again oif competition was working we'd see it taken up as people would most likely pay more for a 12 month contract to get a new phone in a year, it's not and we won't see any changes..

thor

Serves O2 right! I wonder what their head marketing strategist is thinking now? A couple of months ago they obviously decided they no longer needed to look after their existing customers and began offering crap retention deals because they reckoned they could live off the exclusive iphone deal. Well they are no longer the only show in town now and all those lost customers (like me) will have to be offered mighty tempting deals to ever go back to them. I'm just starting an 18 month contract woth Orange so it will be quite a while before I even have to consider them again.

Streeet

gjchester wrote: »

You know I don't think thats the case at all. All the networks offer a very similar range at a very similar price apart from 3 who are basically hoovering up the budget market.

Take a new phone.......
<CUT>
...

I politely disagree.

In this instance O2 have had exclusivity to the iPhone therefore no competition and could charge whatever they like.

Why do people believe there is such a thing as a free phone? Phones cost alot of money to research, develop, build, ship etc etc. They wont give them away unfortunatley!

You can freely get 12 month contracts with all networks. 18 & 24 are cheaper as they can spread the cost base over a longer period and tie you to their network (maximising profit opportunities).
I choose 12 months every time. I pay more but I get to choose a new phone and contract every 12 months.

'most people don't need 60 minutes on a mobile a month'.. I guess you meant 600.. but I know Orange perform 'Best Plan' reviews, or you can request one to ensure you are not paying for to many minutes.

I do however agree that all mobile companies are hiding behind marketing ploys. With the infrastructure at a mature enough level do they really have to sell plans any more? (The only reason could be to manage network traffic)

Unfortunatley the mobile / smartphone market now incorporates social status into price as well as functionality.. otherwise I'd still be walking around with my 1996 Sony Erricson that happily made calls all day long!

gjchester

Streeet wrote: »

'most people don't need 60 minutes on a mobile a month'.. I guess you meant 600.. but I know Orange perform 'Best Plan' reviews, or you can request one to ensure you are not paying for to many minutes.

No I really did mean 60. Most people use the phone to tell there partners they are running late, check the shopping list or arrange a time to be at the pub. Sure teenagers are always on them, and business people need more time but the majority of people never come close to hitting the time they have without a deliberate effort to use the minutes up instead of using the landline.

You can't get anything less than 200 mins / £30 on a 12 month contract on Orange, and it's still more than most people would use if they didn't chat to use up minutes. I doubt Orange would sell an iPhone then say Oh, your tarrifs too high, lets reduce it for you, they'd hold you to the same level till the minimum contract is over. This is more likely to be the case with the Iphone where Apple won't let them discount it.

randomtask_2

gjchester - 60 minutes a month amounts to around 2 minutes a day. I agree most people don't need all the inclusive minutes they get, but 60 minutes isn't likely to be enough for most people.

Ofcom report that the average time spent talking on the mobile (in 2007) is about 136 mins a month, a figure that rises historically year on year(in all likelihood because of the increase in inclusive minutes)...I would say 100-200 mins is likely to be what the majority of people would need. But needing and wanting are different dynamics after all - lots of people want to talk, even if they don't really need to!

Fundamentally though, the networks want to encourage use, in any form...data is the big thing right now, and iPhone traffic is a large contributor to that since all the apps and mobile internet experience are key reasons to get it.

I do agree with you wholeheartedly that competition is effectively muted among the operators though, especially when handset exclusivity is removed.

gjchester

randomtask wrote: »

gjchester - 60 minutes a month amounts to around 2 minutes a day. I agree most people don't need all the inclusive minutes they get, but 60 minutes isn't likely to be enough for most people.

Not so sure.

Typically I'm at my desk most of the day, at home we have unlimited landline calls, so the main time I need to use the phone is to (as I said) call the wife if I'm running late to collect her. Almost all the other times I'll use a landline. I have some friends who work odd hours and whilst they have a desk they are never at is so a mobiles the best way to get them, but they are the minority.

I suspect *many* people fall into that category. The only reason people use more is to use up minutes they are paying for, but now bundles of call time are on landline I suspect the average call time per user will fall.

RoxyK

My iPhone contract ends in a few months so I want to upgrade to a 3GS. But after having been with Orange for years and years and only switching to O2 as they had the iPhone guess what - I'll be staying with O2. Their customer service is superb as is their broadband offer and service. Far superior to Orange. I'll stay where I am thanks