Home > IDC comments on arrival of iPhone 3G in Australia

IDC comments on arrival of iPhone 3G in Australia

Supplier News

iPhone 3G has arrived in Australia amid a wide array of pricing plans from three large carriers in Australia. However, unwary users could find themselves being stung in excess of A$1,000 per GB for data usage.

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 costly excess usage charges.

Of Australia's four main mobile service providers, only 1 is not currently offering the iPhone 3G. Optus, Telstra and Vodafone have introduced an array of plans clearly targeted at different subscribers.

"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.

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.

"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 Mark Novosel.

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.

"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 Mark Novosel.

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.

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."

IDC's report also revealed that:

  • 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
  • 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
  • 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
  • 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
  • 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.

Newsletter sign-up

The latest products and news delivered to your inbox