iPhone News Updated

Orange avoids iPhone price war

Orange will provide the 3G iPhone free on a two-year contract but the new 3GS model will remain an expensive option

Orange, the mobile phone operator, has resisted the temptation to spark an iPhone price war when it starts to sell the Apple device next week.

Orange will provide a standard 3G iPhone free to customers taking a two-year contract at £30 a month, slightly less than O2’s £35 a month.

However, the 3GS, the latest iPhone model, remains expensive. It will be free for customers signing up to a long-term deal at £45 a month, or £175 for those paying £34.26 a month over two years. That compares with O2’s £175.19 upfront payment on the same price plan.

The mere 19p saving will frustrate those customers who had hoped that Orange would spark a price war after it won the right to sell the iPhone alongside O2.

James Parker, mobiles manager at moneysupermarket.com, said: “There is still the prospect of Vodafone offering the iPhone in the new year, which may really get the competition going.”

Instead, Orange will compete with O2 on the basis of network quality. O2 has been a victim of its own success because subscribers with an iPhone, which O2 has been selling exclusively for two years, have used so much of its capacity that its network has slowed down substantially.

[Thanks: http://business.timesonline.co.uk]

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