Tesco Mobile is going to start selling the latest Iphone 3GS from tomorrow. One thing for sure is that they are offering a 12 months contract as opposed to O2 and Orange's 18 months contract. A quick view on Tesco Mobile's website should set fire to other people's pockets. It is not cheap after all.
Relationship
Having said that, we have to look at the relationship between Tesco as a giant company and O2 UK, a mobile company in the UK who is struggling to keep up to the new subscribers each day. While potential O2 customers are shying on taking up a new Iphone 3GS contract due to the announcement of Orange UK to start selling the Iphone 3GS and Vodafone UK as well... O2 UK have started selling their Palm Pre which has not quite grasp the heart of the nation.
Palm Pre
Face the fact though - Although the Palm Pre uses the same cpu as the Iphone 3GS and it has a unique slidding keyboard couple with a capacitive touchscreen, it could not compete with the Iphone 3GS (bigger screen with lots of applets to download for free).
Alternative Mobile Providers
The alternative would be trying to look for a different source of market out there. Tesco Mobile, on the other hand, is keen on embarking on the Iphone 3GS market. They scored well in consumer's confidence in selling their food items and gradually gaining grounds on their non-food items. However, their Tesco Mobile, a collaboration with O2 UK, have not taken up from third base.
With the Iphone 3GS, it will be a perfect way of grabbing a slice of the Iphone market from O2, Orange and Vodafone. Although Vodafone is a late comer, it has nothing to worry about because their Blackberry Bold 2 and the new Nokia E72 is selling like hot cakes.
Tesco Mobile
With Tesco Mobile, consumers will have to pay £320 for a 16GB version of the Iphone 3GS and pay another £20 a month for 12 months which consumers which is worth £60 worth of calls and text per month. In a nut shell, a Tesco Mobile customer will be paying...£320+£240=£560. That is actually quite good considering the fact that the Iphone 3GS could then be unlocked after the 12 months! I think it will be a fantastic idea!
Look at Orange UK's tariff - An Orange UK customer who takes up an Iphone 3GS (16GB version) on an 18 months contract would have to pay £184.50 for the phone and £30 a month for the next 18 months. £184.50+£540=£724.50.
If a customer were to take up an Iphone 3GS (16GB version) from O2 UK, the cost of the handset will be £274.23 and the customer will have to pay £30 a month for the next 18 months. £274.23+£540=£814.23.
A customer buying an Iphone 3GS 16GB on the O2 UK network will be the most expensive while taking a similar contract from Tesco Mobile will be the cheapest and it is, so far, the best deal in town (£20 a month for only 12 months and customer will only need to pay £320 for the phone).
If you are thinking of a Christmas present for yourself and want an Iphone 3GS, I think it will be best to go for the Tesco Mobile contract. Alternatively, if you are not a keen Iphone lover, you might want to stick with your contract as before.
Bravo to Tesco Mobile for coming out with a good deal!!! Just in time for Christmas!!!
Update: False alarm!!!! They have not started selling the Iphone 3GS!!!
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