4/2/2009 3:38:00 PM
O2’s iPhone push as Apple deal comes under review in July
O2 staff were braced for a deluge of customers snapping up the 3G iPhone at a discounted price this week, as the new deals start today (3 April).
The discounts come as O2 nears the renewal period of its initial deal with Apple and is believed to be under pressure from the manufacturer to increase its volumes.
The deal runs for a total of five years from when O2 and Apple signed the coveted initial agreement in October 2007, but the two-year review period is due in July 2009.
There is mixed information from well-placed sources on when, or even if, a new iPhone will materialise in 2009. Some said a new device will appear in October, while another source claimed that Apple will continue with its current device for the rest of the year.
Expectations of a ‘nano iPhone’ appear increasingly unlikely, as the applications that are a central feature of Apple’s phone strategy are designed to fit the existing screen size.
July’s review could see O2 and Apple agree to carry on as sole partners, but there is an outside possibility that Apple will add a second network to increase sales of the 3G iPhone.
Orange is known to be lobbying Apple to be added to its UK distribution beyond O2.
So far, O2 is believed to have performed well, with sales of the iPhone reaching one million units in February.
The O2-Apple deal was agreed between senior Apple executives and O2’s UK management at the time, UK CEO (now Europe CEO) Matthew Key, sales director Mark Stansfeld (now a non-executive director) and its head of devices, Ian Clarke.
This weekend’s price drop on the 3G iPhone (first revealed by Mobile on 13 March) is expected to bring in a new wave of customers who found the initial prices too expensive.
The 8GB 3G iPhone will now be free on its £35 per month tariff (600 minutes and 500 texts), and both 8GB and 16GB versions will be free on the £45 per month (1,200 minutes and 500 texts) tariffs from Friday, but only on two-year contracts. The 16GB version is currently only free on the £75 per month contract, and the 8GB handset is only free on the £75 and £45 per month deals.
Stores will be given new iPhone point-of-sale adverts before this weekend, replacing the existing ‘prepay ducks’.