- 15 Apr 08, 15:40 GMT
O2 has announced it's cutting the price of the 8GB iPhone from £269 to £169. It's a big surprise, somewhat reminiscent of the one third price cut Apple introduced two months after its American launch. Those who've bought an iPhone in the last two weeks will get £100 back.
But the difference is this - it appears to be simply an O2 promotion, with Carphone Warehouse joining in, without any involvement from Apple. I've just confirmed with them that the price at the Apple store will stay the same - so there are going to be plenty of unsold iPhones stacking up there.
Apple won't say whether it is cutting the price it charges O2 for the phone, but I'd be amazed if it is lopping £100 off. So why is O2 giving away what must be all of its profit margin? A spokesman at the mobile operator reassures me that the phone has been its best-selling handset ever and this is simply a "promotion to maintain momentum".
The new 16GB version isn't coming down in price, so perhaps O2 has seen customers trading up and is worried that the 8GB version looks a bit dear.
But there has just been a massive and expensive-looking advertising campaign in the UK national newspapers, so it looks as though that may have been a waste of money. And the man at O2 admitted that “a lot of people who wanted it have now got it" and that the price has been holding some potential customers back.
So a few questions hang in the air.
What does Apple - notorious for controlling pretty strictly the pricing of its products - think of the behaviour of its sole UK operator? Has the iPhone, after a sparkling debut, turned into a sluggish seller in the UK? Or does this simply mean that the 3G iPhone will be arriving in June when O2's cut-price promotion ends?
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