It was reported today by MacWorld UK that o2 in the United-kingdom had briefly published iPhone 3G pricing on their website. The o2 website was offering a locked but contract free Pay As You Go (PAYG) 8GB iPhone 3G for £300 and the 16 GB iPhone for a whopping £400, some £70 more expensive than the first generation iPhone.
It is important to remember that these numbers are still speculative until such times as o2 actually start selling the phone. However, the numbers to make sense if we are to believe iSuppli’s estimate of $170 cost to Apple to build an iPhone 3G. Apple will probably add at least a 100% mark up taking the wholesale price to around $340 – in line with Oppenheimer’s $325 estimate.
The greedy networks, in this case o2 will then need to add a little onto that, so lets double that and call it $650. Now to add Value Added Tax to that at 17.5% bring us to $799 and finally half that to arrive at a figure in Pounds as opposed to United States Dollars and we have …wait for it …£400! Makes sense to me. Your comments in the large box below!
To my no-British brothers and sisters: In the UK, unless otherwise stated, retail prices include Value Added Tax (VAT) which is not dissimilar to goods and services tax (GST) elsewhere. In the UK, VAT runs at 17.5% most of the tome, dropping to 5% and 0% for some special categories of goods and services.
July 19th, 2008 at 3.37pm
Nice blog, i have added it to my favourites, greetings
September 8th, 2008 at 3.16am
That’s expensive! I love the pay as you go capabilities though. Contracts can be frustrating unless you’re with a tried and true company that you already trust.
September 8th, 2008 at 8.53am
iPhones are the most expensive. In the same fashion this contract fee is also very costly.
Still because of the varied features, people still opt for the iPhones.