Why are phones so expensive here??

Forums › One New Zealand (including Vodafone, WxC, Farmside) › Why are phones so expensive here??

portege

188 posts

Master Geek

#17317 21-Nov-2007 07:19

I am currently living in London and got a SE P1i for free on a 35 pound a month term for 18 months- I've added another 7.50 pounds for unlimited data... Free phone! I was just checking out the phones in NZ and subsidies on phones are still next to nothing!

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Ultimate Geek

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#96163 21-Nov-2007 07:46

Powerful duopoly with a small, captive market?

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johnr

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#96164 21-Nov-2007 08:00

Do you think more people live in London.

You need to compare apples with apples

sbiddle

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#96169 21-Nov-2007 08:55

That's not really a fair comparison John. Even in Australia every network can offer free ~ $700 phones on $50 per month 24 month term contracts. Vodafone don't have that many more users than NZ so the whole economies of scale argument can't be used either.

We've always paid inflated prices in NZ for handsets and I can't see that changing anytime soon.

cokemaster

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#96174 21-Nov-2007 09:05

portege:.... I've added another 7.50 pounds for unlimited data...

Yes.... unlimited* data.....

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BrentR

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#96175 21-Nov-2007 09:06

There's this funny saying that goes something like this.

"Make hay while the sun shines"

;)

Nightwyrm

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#96176 21-Nov-2007 09:08

sbiddle: the whole economies of scale argument can't be used either.

I think it does help explain it to a certain extent. 7.5 million population in London compared to 4.2 million for all NZ sounds to me like the English telcos have a lot more freedom to offer heavier subsidies with less risk of financial loss. As for Australia, considering Sydney alone has the population of NZ, perhaps VFAust feel they have a bit more freedom to offer subsidies. I'm not sure you can compare number of current users on a network when the subsidised phones are really aimed at new business.

Didn't VFNZ used to do subsidised phones once upon a time, before they "got rid of all the contracts"? I made the change to the network back in the day and got a free Nokia 3310 on a 24-month contract

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portege

188 posts

Master Geek

#96178 21-Nov-2007 09:18

Yes, but with a population of 7.5million, but over how many telcos? Say only if you capture 30% of that market, you would still capture the same market size as in NZ in a duopoly market

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mobygeek

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#96182 21-Nov-2007 09:34

NZ Telcos still have to put up infrastructure in some pretty rugged terrain.

Back int the 'good old days' (40 degree heat etc) of Aussie, Optus was subsidising phones, but would still have extra disconnection fees on really huge subsidies, like the 8210 where the normal cancellation fee was cheaper than the actual phone.

What was really great was my buy price, at the price the phone cost on a thirty dollar a month plan. Zero dollar phones... Still, paid heavily for stock when out of price protection and also old stock not connected could be a problem. If you buy a phone outright over there they are still expensive.

Plus the Australian prepaid handsets are sim locked, network locked, sim-type locked etc... And Vodafonewas the first to do it in aussie as far as I know...

I do appreciate the unlocked phones over here. Your British phone will be locked, Portege!

sbiddle

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#96183 21-Nov-2007 09:40

lugh: I'm not sure you can compare number of current users on a network when the subsidised phones are really aimed at new business.

I completely disagree. The main market for "free" phones is infact people who resign on their existing network every two years in return for an upgraded handset. New business is only a small part of the market particularly now that the mobile market is saturated since in most competitive markets everybody offers you a free phone. Ask most people in Australia or the UK when they last paid for a phone and the answer will more than likely be never. They expect that when they sign up on a term contract that they will get a free phone.

portege

188 posts

Master Geek

#96186 21-Nov-2007 09:46

mobygeek - No phone is NOT locked, in fact no phones in the UKs are locked except the iPhone. It is against the law to lock phones. It is regarded as anti-competition.

Having used to work for Telecom on their consumer marketing team; I have seen the costs of subsidising a phone, in fact most phones are actually subsidised but NZers except to pay for phones were as the Brits, dont - this is the main difference.

johnr

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#96195 21-Nov-2007 10:44

portege: mobygeek - No phone is NOT locked, in fact no phones in the UKs are locked except the iPhone. It is against the law to lock phones. It is regarded as anti-competition.

Having used to work for Telecom on their consumer marketing team; I have seen the costs of subsidising a phone, in fact most phones are actually subsidised but NZers except to pay for phones were as the Brits, dont - this is the main difference.

Just checking this: you are saying " no phones are locked in the UK apart from iphone "

portege

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Master Geek

#96197 21-Nov-2007 10:49

http://news.bbc.co.uk/2/hi/technology/6978110.stm

I have personally put a tmobile sim in my o2 supplied P1i

Nightwyrm

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#96198 21-Nov-2007 10:56

sbiddle: I completely disagree. The main market for "free" phones is infact people who resign on their existing network every two years in return for an upgraded handset. New business is only a small part of the market particularly now that the mobile market is saturated since in most competitive markets everybody offers you a free phone. Ask most people in Australia or the UK when they last paid for a phone and the answer will more than likely be never. They expect that when they sign up on a term contract that they will get a free phone.

I agree that resigns would be a large factor in the equation but churn should be a major contributor. Assuming that they think logically (

), wouldn't a telco aim at stealing other networks' customers with offers of better "free" phones and services? That would be my definition of a competitive market, especially in a saturated market.

(ooh, debate, debate!)

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mobygeek

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#96212 21-Nov-2007 13:22

We often send people up to parralel imports to get their UK phones unlocked so they can then go to the opposition and purchase a sim card... (We often get new New Zealanders in our Telecom store wanting to buy a sim card.) Our English lass even had to have her Orange phone unlocked. Most European GSM phones were sim locked when I worked in Australia, even if they had bought them outright...

photoman

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Master Geek

#96224 21-Nov-2007 15:35

Whilst living in the UK, I purchased a Nokia phone locked into the Orange network. The first thing I did with it was to unlock it and put in a Vodafone sim card. I am still using the same phone here in NZ four years later.

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