Consumers warned that iPhone contracts may not be value for money

20 September 2007
O2 have announced that they are to be the exclusive suppliers of the iPhone, the latest high-tech mobile to hit the market, but there are concerns amongst experts that consumers are being swayed by the novelty of a phone that may not be all it’s cracked up to be.

Consumers have been anticipating the arrival of the iPhone for some time now and on 9 November, fans can get their hands on the prized mobile for £269 before signing up to a £35, £45, or £55 a month O2 special tariff. But will extra long contracts, expensive tariffs and poor value for money sour things for the iPhone?

While there is no disputing the fact that the iPhone is the first of its kind and enables users to have unlimited mobile data usage and access to 7,500 wi-fi hotspots, browse the internet and access email on the move without worrying about additional charges being added to their bill, the handset does not have 3G capability and half the memory of the iPod Touch, which retails at the same price.

Chris Frost, mobile phone expert at uSwitch.com explains: “Given the fast pace of change in handset technology, it’s good news that contracts will be 18 months long and not the widely predicted 24 month minimum term.

“However, it’s not all a bed of roses. Like the iPhone launched in the US earlier this year, the handset does not feature 3G, meaning that customers will only be able to experience web browsing to the full when they are connected to a wi-fi network.

“Secondly, the 8GB of memory is half that of the top of the range iPod Touch – the ‘iPhone without the phone’ – that, for the same cost of £269, features 16GB of memory, wi-fi web browsing and doesn’t tie you into a £35 month contract for 18 months.”

In addition, the tariffs offered with the iPhone are one of the least competitive on the market in terms of inclusive minutes and texts. For example, £35 a month customers will receive 200 minutes and 200 texts – compared to O2’s usual tariffs such as the Online Texter 35 that provides 600 minutes and 1000 texts for the same price.

Frost concludes: “The iPhone is a groundbreaking device that will undoubtedly be very popular with iPod fans everywhere. However, while customers may decide to hold off for the inevitable 3G version, others may consider the relative benefits of buying an iPod Touch music player alongside a better value mobile contract.”

Learn more about the iPhone and compare mobile phone tariffs