O2 has responded to criticisms of poor value offered on the iPhone deal by tripling the amount of minutes and texts it offers with the £270 Apple handset.
£35 a month tariffs will now come with 600 minutes and 500 texts, up from 200 minutes and 200 texts. And the minutes included in a £45 per month tariff have been doubled to 1200, however the number of texts remains the same at 500. The increased offerings will be available from 1 February.
The tariff change comes after staff at O2 and especially Carphone have reported exceptionally slow sales on the iPhone despite an initial spurt when it was launched on 9 November. Staff have consistently accused O2 and Apple of ‘being greedy’ in charging £270 for the handset, and then adding such a low value tariff.
A spokesman for O2 said that there were no plans to reduce the price of iPhones.
The increase of 400 extra minutes for £35 per month tariffs - which could cost O2 as much as £1200 per customer in lost revenue – has been welcomed by analysts.
The £1200 hit has been calculated if customers were making a total of 600 on the old tariff, and are now continuing with the same usage.
Shaun Collins of CCS Insight described the change as ‘a very welcome move’. He said: ‘It makes it easier for channels to sell. The tariff was always a weak point – it will unquestionably reinvigorate sales of the iPhone.’
The changes bring the iPhone tariffs closer to packages offered by other operators in the important £35 per month sector of the market, which Collins estimates accounts for 70% of the UK contract market.
O2 confirmed that existing customers who have already signed up to an iPhone contract with will have their monthly minutes and texts increased from February, a move which should avoid the backlash faced by Apple when it cut £100 of the price of the iPod two months after it launched.
Existing customers will also be allowed to downgrade to a cheaper tariff without having to extend their original contract.