The 3G was subsidised by the carriers and the pricing structure was worked out over X months of your contract for them to get as much money as possible out of us.
By subsidising the the new one within the X months of the original contract they screw up their figures and lose money.
The problem is that as the iPhone has progressed, im pretty sure it has not become more expensive to produce. If anything, i'm more than positiveproduction costs have become cheaper.
The original iPhone was over £300 to begin with, then reduced to £269 here in the UK to boost sales, eventually dropping to below £150 to get rid of remaining stock of the 2G. (I think early adopters even got refunded the difference after the price drop)
The PAYG price for the 3GS is £538, 200% that of the price of the 2G 2 years ago.
ALSO, Orange in France today revealed prices of the iPhone 3G S (Factory Unlocked) which weigh in at:
16GB = 559 Euro
32GB = 669 Euro
http://estore.orange.fr/stores/prosp...equestid=29074
using
XE - The World's Favorite Currency and Foreign Exchange Site these prices equate to:
16GB = £472
32GB = £564
The UK prices for PAYG iPhone 3GS
LOCKED to O2 UK:
16GB = £440
32GB = £538
Pay & Go
so thats only £32 / £26 more on each handset to purchase a Factory Unlocked iPhone 3GS. I mean, really?
Either way, £538 for a MOBILE PHONE is absolutely rediculous. This is allot of money, the kind of money that pays a couple months rent / buys a new car, you know, real world stuff. I am lucky enough to have the spare cash right now to go and buy this Friday if i wanted - but i won't and unless it changes i won't in the next year.
The reason the average consumer didnt want the iPhone before was because they had to outright pay £269 for a handset they wanted for free. The excuse was the iPhone was to expensive.
Now the iPhone only appears to be cheap becausethee out of contract / PAYG handset prices are rediculous, making the subsidised prices look like a good deal. The PAYG prices are far to high for the average consumer, almost forcing us into LONG contracts.
I love my iPhone and have been a loyal user since the 2G. However, i am in no way blind or stupid and can clearly see that us as consumers are being screwed by both Apple and our carriers. The iPhone should never have been allowed to be subsidised by the carriers. If the 3G S does not come down in price, and this is the trend that follows with all future iPhones, then my 3G will be my last iPhone.
Just to reiterate - the iPhone 3G S is
200% the price of the 2G 2 years ago. We are in a recession but facing extortionate inflation on our iPhones ....