After the great elation of hearing about the release of the new iPhone 3GS by Apple at the WWDC 2009 now comes the heartbreaking and shocking news that UK residents simply cannot own one. In essence this means that if you were one of the keen purchasers (on a monthly contract) of the iPhone 3G early on when it was released then you must now pay the penalty of being ineligible for an upgrade. This has caused a public outroar on the web and enraged and frustrated many. Twitter is flooding almost in real time with messages of outrage and complaint, a twitter trend #o2fail has appeared and direct dialogue has been established with O2 through their very own twitter account. There is even an online petition (twitition) for the cause. News websites (1,2) and blogs are also expressing their dismay and reporting on that of others. Despite this frenzy of activity O2’s policy remains and that feeling of lack of control and an inability to get around these restrictions can be difficult to channel and vent.
My situation is dire. In order to upgrade to the new iphone I must pay £555 in total: £280 for the remaining term of my existing contract (8×25) plus £275 to get the 32gb version of the new iphone on a £35/month tariff. This is equivalent to buying the iphone 3gs outright on pay as you go for £540. Either is a serious amount of money. Many factors have given rise to this incredibly difficult situation. Apple has released a new phone within a year of their previous release and that too with a brand new operating system and new hardware specifications. Secondly O2 has for some time had exclusive rights to sell the iphone in the UK which means that they have now acquired a captive audience that must continue their subscriptions simply because there are no alternative provider opportunities. Lastly, whether you wish to believe this or not, the truth is that the iphone is unlike any other and is therefore evoking a reaction unlike any other.
I understand where O2 are coming from – when people bought the iphone 3g last year, like myself, they agreed to heed the terms of their 18 month contract. At the time we were happy to have the new iPhone that utilised the fastest available data network in the UK and also it certainly didn’t seem likely that Apple would re-release as soon as they have done especially given that data networks were not expected to leap in speed anytime soon. O2 also set their own trend by allowing upgrades from iPhone Edge to iPhone 3G. However things change and when Apple is involved you have to expect the unexpected.
Regardless of what the contracts say there is one simple yet crucial fact that O2 have failed to realise – for innumerable reasons the iPhone has become an exception to all rules and for that reason must be treated as one. The iPhone is unlike any other phone and has an appeal unlike that of any other phone. At this point it is no longer a phone – it is whatever you want it to be at all times. It has become an ingrained part of peoples’ lifestyles and the two are virtually inseparable and indistinguishable. It would be redundant to go through why it has become such an exclusive item and an object or desire as that should be more than obvious by now but simply to say that it has and it will only become more so. Given that – anyone who stops to consider the dynamics of the iphone’s appeal to the mass public whether a lay person or a business entity should realise that you simply cannot deprive the public of a new iPhone release and get away with it unscarred. O2 is facing the rebellion assault and will have made many enemies over time – even more so than previously.
The lack of competition i.e .a monopoly for such reasons is a very bad thing. There are rumors that the exclusivity contract between O2 and Apple is coming to an end in the last quarter of this year. Let’s hope that’s the case. The shifts in mobile phone contracts is worrying to say the least – initially we moved from 12 month to 18 month and now O2 is beginning to offer 24 month contracts. Expecting consumers to keep the same phone for that amount of time is hardly realistic. There will be new releases and consumers will want a change after some time. The feeling of lock in is not a pleasant one – it can be incredibly frustrating. On top of that O2 is beginning to charge around £15/month for iphone network tethering despite the fact that the phone has unlimited data. The average consumer needs the internet but is the average consumer able to afford such exorbitant monthly fees?
So now what? O2 customers will either fork out £500-£600 to upgrade from their existing contracts and grow bitter over time in the company of their new iPhone about the amount of money they’ve spent or they’ll forego the purchase and grow bitter over time about having been made to watch the iphone 3gs revolution from the sidelines. Either way the outcome for O2 is not good in terms of public opinion and loyalty.