Monday, 11 September 2017 13:02

Survey expects new iPhone price to ‘sting’ for Australians

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With Americans freaking out over $1000+ iPhone prices, which Australians have already paid for years, a new price hike is set to spike the blood pressure of the easily spooked.

Dance like a butterfly, sting like a bee, will new iPhone pricing be too high for we?

That’s the question many have on their lips with anticipation that, especially when it comes to 256GB and possibly even 512GB models (as is already the case with the iPad Pro range), prices for top-end iPhones could, in Australia at least, breach the $2000 barrier for the first time. You can also see news of the latest iPhone 8 pre-launch leaks here

Telco comparison service WhistleOut has shared some info on iPhone pricing expectations of its users, but before we get there, some of my own brief commentary.

With the Samsung Note 8 starting at $1499 for the 64GB model, and the 128GB and 256GB models to be naturally priced even higher, stratospheric flagship smartphone pricing is now the norm.

Yes, two-year pricing plan contracts with telcos will somewhat take the sting out of the tail, but it’s a tale of woe that some will dread, as iPhone and Note 8 prices look at eclipsing that of some iPads and high-end notebooks.

At least prices are still nowhere in the vicinity of a house deposit — or at least, not yet — while ringing true the adage that you get what you pay for.

After all, there are sub-$300 Android-based iPhone clones that have never been more outrageously pixel-perfect in their cloning, and impressively powerful thanks to ever better mid-range processors, but as Apple has reminded us in the past, if it isn’t an iPhone, it ins’t an iPhone.

So, what has WhistleOut’s survey uncovered?

Well, it appears that Australians “will likely have to pay nearly two-thirds more than they’re willing to for the new iPhone 8".

We’re told that “Apple’s new iPhone range is due to be announced on Tuesday 12 September in the US, Wednesday morning (3am) Australian time, with the flagship iPhone 8 device widely expected to be priced at approximately A$1500 outright".

Whistleout used the usual survey methodology, asking “over 1000 Australians how much they would be willing to pay for the forthcoming iPhone 8, either on a monthly contract or to buy the phone outright".

The results “show Australians interested in buying the new phone are willing to pay, on average, $920 for the new model”, which as Whistleout points out, means you’ll have to stump up “another 63% more if the expected pricing is confirmed".

Unsurprisingly, “the story is similar for those interested in getting the new iPhone on a contract. The survey shows $75 is the average monthly contract Australians are willing to pay for the new handset, and that the average required monthly data allowance is 10GB".

WhistleOut estimates this combination of iPhone and plan “will cost $100-$120 per month, based on current iPhone pricing trends across Australia’s carriers. That’s a 33% increase on what the average Australian is willing to pay".

Of course, people are willing to pay a little extra to get the best, and 33% is a lot easier to swallow than 63%.

So, what does Joseph Hanlon, WhistleOut’s publisher and telco expert, have to say on the survey findings?

“We’ve been analysing the pricing of iPhone plans for the last decade and if history is any sort of a guide, Australians will have to pay $100 per month or more for the new iPhone if they want any kind of decent data allowance, or around $1500 to get the phone on it’s own and then buy a SIM-only plan on top of that.

“When Apple launched the iPhone 6s and iPhone 6s Plus two years ago, the entry level models cost $1079 and $1299 respectively, with higher storage models going for $1379 and $1529. Even 2014’s iPhone 6 cost $929 for the basic model the following year.

“That pricing gives us a benchmark to work from and we can expect the touted price tag of $1500 to be fairly accurate for the new device, so we’ll have to go out of our comfort zone if we want to get the new iPhone outright.

“When it comes to buying the new iPhone on a plan, if you shop around today $75/mth will get you an iPhone 7 with about 2-5GB of data. But, with most people looking for up to 10GB of data, the average Aussie will need to find an extra $25 per month or more to own the new iPhone.

“We modelled iPhone plan pricing trends for the last few years to generate probable estimates for the new iPhone on a plan of 3GB or more. All the estimated plans cost over $100 per month, including handset repayments, with some variance depending on provider and data package. (See Whistelout’s estimated iPhone 8 pricing here.) 

“We’ll know more once Apple announces the new phone(s) with pricing on Wednesday morning, and the full picture should become clear when carriers announce their pricing before availability date, which is expected to be around 22nd September in Australia and globally,” continued Hanlon.

And what of the additional survey findings?

We’re told that the survey indicates “the maximum any Australians are willing to pay for the iPhone outright is $1500, while a few would stretch to $150 per month for the new iPhone on a contract. This shows there is a segment of the population prepared to pay the expected going rates for the new device; more so when buying it on a monthly plan.”

Then there’s those crazy 18-24-year-olds for whom YOLO and FOMO are rights of modern-day, 21st century passage. It turns out they’re “willing to pay the most for the new iPhone outright ($1015)".

Meanwhile, the older and (presumably) wiser 45-54-year-olds are willing to pay the least ($803).

And, when it comes to buying the new iPhone on a plan, “35-44-year-olds are willing to pay the most at $85 per month. This is considerably more than other age groups with 18-24 year olds happy to pay $76 per month, dropping to $68 per month for those aged 55 or over".

This is followed by the survey showing “49% of people interested in the new iPhone would prefer to buy it outright, while 51% would rather get it on a plan".

Will consumers 'stick and wait?'

Hanlon gives his thoughts on this possibility, and says: “Bearing the expected pricing in mind, it may not come as a surprise that almost two-thirds of people (65%) interested in getting the new iPhone aren’t expecting to get it this year because they think it’ll be too expensive.

“The survey also showed 39% of Australians interested in the iPhone aren’t willing to switch carrier to get better deal on it. This is largely driven by the loyalty of Telstra customers. Only 44% of Telstra customers would be willing to switch providers to get a good deal on the new iPhone, while 71% of Optus customers, 72% of Vodafone customers and 81% of Virgin customers would move elsewhere for the right iPhone package.

“This says a lot for the power of the Telstra brand. Despite a number of high profile network outages over the last 18 months and typically higher pricing options than competitors, it looks like most of Telstra’s mobile customers will stick with them when the new iPhone comes out.

“The new iPhone may well set a new quality benchmark for mobile phones, and also a new benchmark for mobile phone pricing. Being the 10th anniversary of the first iPhone expectations are higher than ever this year, but it could be a case of ‘no pain, no gain’ for new iPhone buyers. With costs for the new iPhone expected to be higher than ever, make sure you find the best deal for your usage needs by checking what’s available first, before jumping in.”

So, there you go. WhistleOut gets to rustle up some free publicity on the back of what is arguably the most anticipated smartphone and technology release of the year, each year, as Australians get set for the most expensive iPhone yet, but the most powerful one ever released too – and the possibility the 7s and 7s Plus, which some have dubbed the 8 and 8 Plus, will actually be cheaper than last year’s models.

Not long to go now before the speculation ends, and the reality of new iPhones, new iOS and new Apple tech begins – definitively!


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Alex Zaharov-Reutt

Alex Zaharov-Reutt is iTWire's Technology Editor is one of Australia’s best-known technology journalists and consumer tech experts, Alex has appeared in his capacity as technology expert on all of Australia’s free-to-air and pay TV networks on all the major news and current affairs programs, on commercial and public radio, and technology, lifestyle and reality TV shows. Visit Alex at Twitter here.

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