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Does the UK iPhone Plan Add Up?
An anonymous reader writes "Is it just me or is the UK iPhone deal seriously more expensive than the US deal? If you look at what AT&T offers compared to what O2 offers, you get significantly less for your money in the UK than you do in the States. It's also significantly more expensive than other non-iPhone deals in the UK, which offer similar services. Steve Jobs response to the more expensive UK iPhone is that 'it's more expensive to do business in the UK', but what does that mean? As a UK resident I'm disappointed that we didn't get the same plan as the AT&T plan, particularly the free mobile-to-mobile calls. Is there some element of the UK iPhone service that I'm missing here?"
Alas, the tax rates are dramatically higher there and they probably sock it to the cell phone folks. There are many things to love about Britain, but it's not known for selling stuff on the cheap. Practically everything costs more there except, perhaps, for warm beer. And if memory serves me right, there was a raft of regulations that kept prices of beer cheap. That's a simple way to buy off the masses.
The free WiFi via TheCloud makes the wifi portion of the iPhone actually useful, as there are thousands of TheCloud WiFi networks around the country. I don't think that there is anything similar for the US iPhone.
Also the unlimited data usage is probably underestimated. Sure, they say 1400 pages a day, but how big is a web page these days (excluding Flash)? 100KB? That's 140MB a day, which would cost a tonne over here with many other deals.
The talk and text limits are rather poor of course. I pay £10 a month for 500 minutes and 100 texts with Three, so when £35 only has 200 minutes and 200 texts and no phone subsidy you have to worry.
Everything is more expensive in the UK than in the States, even though wages are lower on average. Why do companies charge more for the same product over here?
Because they can.
British consumers have become numbed to paying more for less over the years, so companies clap their hands with glee at the thought of increasing their profit margins by 50% or more over the US for exactly the same product. "Oh, but you use PAL." "Oh, but you use 240 volts AC with three-prong plugs." "Oh, but you have VAT." Always the same excuses, and they're pretty much bullshit - but nobody questions them any more. We've been ground down by decades of being ripped off.
You must think in Russian.
In general, US and European providers have VERY different pricing structures, and so you will not likely ever see parity in plans available.
Among other things, as I understand it:
European wireless customers never pay for incoming calls. Calls are charged to the caller, whether the caller is a landline or mobile. U.S. wireless customers pay for all incoming and outgoing calls (well, the calls are deducted from their monthly airtime allowance...), subject to exceptions (mobile-to-mobile on the same carrier, off-peak times)
European wireless customers only pay for outgoing SMS, not incoming. U.S. customers pay for both, with the above voice exceptions often applying to SMS.
Few European wireless carriers offer flat-rate data plans, although their pay-per-kilobyte prices are typically far cheaper than U.S. pay-per-KB prices. U.S. carriers offer exorbitant pay-per-KB prices so that anything but a minimal amount of usage proves to be more expensive than the flat-rate monthly plans. This is the big problem with the iPhone in Europe - as a few other articles have indicated, it was basically designed around an unlimited-data plan and in fact AT&T won't sell you the unit unless you get unlimited data service.
In general, Europeans jumped straight from GPRS to UMTS, skipping EDGE deployment. Bad for iPhone, no UMTS capability.
To make a long story short - comparing pricing between a U.S. carrier and a European carrier is like comparing apples to oranges. It's much easier to compare pricing schemes between U.S. carriers, which all operate on similar principles. (One exception - I get the impression European plans are a much closer match to U.S. prepaid/pay-as-you-go plans, except they are far more reasonably priced. U.S. PAYG plans are massive ripoffs.)
retrorocket.o not found, launch anyway?
It's not called Rip Off Britain for nothing you know.
Seriously though, yes our prices include VAT at 17.5% which people often forget to take into account but, even so, there are plenty of products which have such a colossal additional mark-up on them (Windows Vista is twice as expensive which tax and shipping costs cannot explain away) compared to our European and American counterparts that it is hard not to feel cheated.
The Wikipedia article on it is worth reading and notes that these items cost significantly more in the UK:
Unfortunately as we put up with paying those prices, we allow companies to continually screw us.
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