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iPhone 3G Hits Australia - But be Careful Where You Click, Cautions IDC

  • 24 July, 2008 10:20

<p>SYDNEY, 24 July 2008. The highly anticipated iPhone 3G arrived in Australia amid a dizzying array of pricing plans from the three largest carriers, with Australia becoming the first country in the world to offer the iPhone 3G on three networks. However, unwary users could find themselves being stung in excess of A$1,000 per GB for data usage.</p>
<p>IDC's report titled Careful Where You Click: iPhone 3G Hits Australian Market and Consumers' Credit Cards, revealed that while Australians are able to obtain an iPhone 3G on a plan for as little as A$816 or A$729 prepaid, the overall value in Australian iPhone 3G pricing plans leaves a lot to be desired and comes with very costly excess usage charges.</p>
<p>Of Australia's four main mobile service providers, only 3 is not currently offering the iPhone 3G. Optus, Telstra and Vodafone have introduced an array of plans clearly targeted at different subscribers.</p>
<p>"Optus, the first to announce full details of its iPhone 3G plans, has the widest selection of options, provides the most flexibility and arguably the best overall value for users. Offering both capped and non-capped plans, Optus does not reduce value in its caps and includes a bonus data allowance, with the added choice of a 12/24 month contract," said Mark Novosel, Market Analyst, Telecommunications at IDC.</p>
<p>Although charging a significant premium for the shorter 12-month contract, consumers are locked in for half the duration and can own an iPhone 3G for a lower overall cost. A 12-month contract option is currently not available on other Australian networks.
Consumers needing nationwide coverage rejoiced at Telstra's announcement to stock the iPhone 3G, however the joy was short-lived as details were revealed.</p>
<p>"Telstra competes based on coverage, not price. Therefore, expecting the company to offer large amounts of included value or data in its plans would have been unreasonable. However, Telstra's entry-level $30 plan which provides a trivial 5MB of data per month - which can be consumed in less than one minute, downloading a single song, leaves consumers with excess usage charges of $1/MB," adds Novosel.</p>
<p>Less than two weeks after launch, Telstra has revamped its iPhone 3G plans to include a mandatory data bundle. Telstra's current entry level iPhone 3G $59 Package consists of an unchanged $25 value, now with 93MB of data, and effectively costs $75.63 per month over 24 months including handset payments for the 16GB iPhone 3G.</p>
<p>"Vodafone's iPhone 3G pricing has gone against the company's recent trends, such as pioneering moves by slashing mobile broadband to $39 for 5GB, which resulted in a unanimous downward shift in mobile broadband pricing across the board," states Novosel.</p>
<p>Vodafone's entry-level launch plan was the $69 iPhone Cap, providing $310 worth of included value and 250MB data, effectively costing $81.88 per month for the 16GB iPhone 3G. In contrast, Optus' $59 iPhone 3G Cap costs $66 per month and provides double the data and $350 included value.</p>
<p>Referring to other international markets, Novosel stated "It is a shame for Australians that 3 does not offer the iPhone 3G. The company has consistently lead the way with increased value plans and lower cost mobile services. 3 Hong Kong offers the best value iPhone plans in the Asia/Pacific, and given the opportunity, 3 Australia would no doubt offer market leading value through compelling plans."</p>
<p>IDC's report also revealed that:</p>
<p>· 3 Hong Kong Sets the Benchmark. Of the eight entry-level iPhone 3G plans in five countries analysed, Hutchison's 3 Hong Kong provides the overall best mix of cost and inclusive value, with 500 national minutes of voice calls, 2000 minutes of on-net calls, unlimited SMS and 500MB data for an equivalent A$49.08 per month over 24 months including handset payments.</p>
<p>· Canadians Hardest Hit. Rogers Canada is forcing consumers to sign a three-year contract costing upwards of A$2,825 with only 150 peak minutes of calls, 75 SMS and 400MB data. With an effective monthly cost of A$78.47, Rogers' plan provides the worst cost/value mix of the plans analysed.</p>
<p>· New Zealand – Mixed Feelings. Although Vodafone's NZ$80 Plan proves to be expensive compared to Australian carriers' offerings, the plan compares favourably to other Vodafone New Zealand plans on offer. Effectively costing A$85.79 per month or A$2,059 over 24 months, the plan provides 120 minutes, 600 SMS and 250MB data.</p>
<p>· Apple Revolutionises Market. Apple has successfully inverted the perspective of the mobile device: from primarily a voice and messaging focus with occasional data use, to an Internet-centric focus, on a device that also makes phone calls.</p>
<p>· Apple Must Relax its Iron Grip. Long term success for Apple in the converged mobile device market will require it to relax the many restrictions placed on the iPhone, which users of other devices now take for granted. The inability to utilise Bluetooth file transfer, USB mass storage mode, playback of various media formats and seamless use on multiple networks are prime examples of Apple's firm control over the iPhone which are key inhibitors for many users looking to upgrade to an iPhone. Initial hysteria surrounding the iPhone will not last forever and in order for Apple to increase market share it must listen closely to the market.</p>
<p>If you would like to purchase IDC research, please contact Gary Clarke, Associate VP of Sales, IDC via e-mail gclarke@idc.com or phone 02 9925 2226.</p>
<p>Ends
For more information or an interview with the analyst, please contact Sally Taylor-Phillips, Marketing Communications Manager at IDC on +61 2 9925 2234 or e-mail staylorphillips@idc.com.</p>
<p>About IDC</p>
<p>IDC is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. IDC helps IT professionals, business executives, and the investment community make fact-based decisions on technology purchases and business strategy. More than 1,000 IDC analysts provide global, regional, and local expertise on technology and industry opportunities and trends in over 100 countries. For more than 44 years, IDC has provided strategic insights to help our clients achieve their key business objectives. IDC is a subsidiary of IDG, the world's leading technology media, research, and events company. You can learn more about IDC by visiting www.idc.com or www.idc.com.au.</p>

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