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Survey: iPhone too expensive for UK market

updated 08:45 am EST, Fri November 23, 2007

Survey on UK iPhone Price

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.



By Electronista Staff
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  1. dliup

    Fresh-Faced Recruit

    Joined: Jan 2006

    0

    haha

    1. Just because people can get garbage for free from the dumpsters, doesn't mean people will avoid going to gourmet restaurants.

    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!

  1. macmad

    Mac Enthusiast

    Joined: Dec 2000

    0

    Its a fair price

    and the iPhone is worth it - its the first phone I've really been impressed with.

  1. edinburghmac

    Fresh-Faced Recruit

    Joined: Jul 2004

    0

    too expensive

    While a couple of years ago the most expensive handsets would come in at the £200 mark when first released, people expect them to be much cheaper now. Many of the top phones cost nothing up front when bought with an expensive price plan. Apple is asking for a top price and an expensive price plan - most people won't pay this much. £269 for an unlocked iPhone would be a fair price (an 8GB iPod touch is £199 and the extras in the iPhone (2MB camera, 2.5G phone are just about worth the extra £70)

    (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)

  1. dliup

    Fresh-Faced Recruit

    Joined: Jan 2006

    0

    not expensive

    There are people paying 700 Euro for unlocked iPhones.

    Just because YOU can't afford it doesn't mean other people can't afford it.

  1. Gee4orce

    Professional Poster

    Joined: Dec 2000

    0

    2% is above target

    Considering Apple's stated intent was to capture 1% of the handset market, and this survey reports that 2% of people are considering an iPhone, shouldn't the title of this story be more like "iPhone demand double expectations" ???

  1. Frogmella

    Fresh-Faced Recruit

    Joined: Sep 2001

    0

    Oh yeah?

    When you look at the iPhone as just a 'phone, it does seem expensive. But if you're on an expensive plan anyway, and in the market for a new iPod, suddenly £269 to get THE best music player and THE best 'phone in one, pocket-friendly unit seems very tempting.

    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?

  1. dliup

    Fresh-Faced Recruit

    Joined: Jan 2006

    0

    cost of living

    Hi frogmella,

    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.

  1. coldfusion1970

    Fresh-Faced Recruit

    Joined: Nov 2004

    0

    prices

    The price of the phone is not a issue (i purchased the iPod touch for around the same price), the real off-putting factor is the monthly surcharge. I'm pay-as-you-go at the moment and i dont want to switch to a 18 month contract just to get the iPhone. I'll wait until Apple releases a pay-as-you-go version or a much cheaper contract version.

  1. kirasaw

    Fresh-Faced Recruit

    Joined: Apr 2007

    0

    Too Expensive or too poor

    is the iPhone too expensive for the British or does the general population lack the deposable income needed to have such products?

  1. Guest

    Fresh-Faced Recruit

    Joined: Nov 1999

    0

    UK is poorer

    According to wikipedia per capita income is lower in the UK than US. http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)_per_capita

    $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.

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