11/23/2007, 8:45am, EST
Friday, November 23rdSurvey: iPhone too expensive for UK market
Apple's decision to price the iPhone for UK residents at £269 may have reflected a serious misjudgment of the local cellphone market, according to a new survey of Christmas buyers conducted by the analyst group GfK NOP. Of the respondents, 46 percent simply refuse to consider the phone at its existing price; just over a quarter at 26 percent are interested in the phone but cannot justify the cost, the researchers say. This leaves only 2 percent actively considering the iPhone for the holidays; 5 percent are willing to consider other phones while 8 percent actively dislike the device. About 12 percent of the surveyed population does not even know the iPhone exists, GfK NOP says.
Much of this hesitation can be attributed to British cellphone culture, which unlike the US frequently subsidizes even premium phones below the £200 ($412) mark. In some cases, smartphones such as the Nokia N95 are available for free with better calling plans. The high cost of Apple's first cellphone stands out as a central issue for most prospective UK buyers, says GfK NOP's Richard Jameson.
"This is a highly competitive market and the mobile phone manufacturers have very strong brand loyalty," he adds. "Apple needs more than cutting–edge design to penetrate this market and will have to work much harder in the UK than it did in the US."
In spite of the poor standing among actual buyers, however, the iPhone is still associated most with special features on phones than other brands. The handset defines music phones for 78 percent of all respondents to the survey, while 65 percent think of it first when considering e-mail or web browsing.
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2. People in the UK makes about twice as much money as people in the US, so the £269 is similar in cost to $269 in the US!
(By the way dliup - people in the UK don't make twice the salary as in the States - you would be shocked how much of an average UK wage an iPhone cost)
Just because YOU can't afford it doesn't mean other people can't afford it.
I haven't done it myself - in the UK on a hacked US iPone - because my usage would never justify £35 a month, but plenty of people never take the bloody things away from their ears!
dliup: can you cite your sources for any of these 'facts'? Are people actively buying the unlocked iPhones? Do I really earn twice that of my equivalent across the pond?
Totally agree with you that iPhone is more than a phone. It's an iPod and the best phone, and having a useable browser is surely convinent.
I have friends in London, I do visit too.
Not sure about hourly wage workers, because that's not iPhone's primary target audience, but in London, people (of middle class and up) earn twice as much as the average US person, for example, financial analyst gets paid £45,000, but same position gets $45,000 in the US. However cost of living is twice as much too. For example, cheap lunch is about £5, whereas a cheap lunch in the US is about $5. Cheap dinner is £10, cheap dinner in the US is $10.
So adjusted for cost of living, 1 Pound is similar to 1 USD (well not exactly but close enough). So one cannot say £269 is similar to $269x2. £1 has the same purchase power as $1 USD, so £269 is actually cheaper than $400 USD.
I cannot tell you where people are paying 700 Euro for an unlocked iPhone, because I sell them.
$43000 vs 35000.
Meanwhile the cost of living is higher in UK than USA http://www.finfacts.ie/costofliving.htm A burger meal for example costs $8 vs $6
This translates into lower disposable income in UK.
In short, USA is wealthier than UK, so Apple must be rather stupid in trying to get away with selling a more expensive product to the mass market here.