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O2 Reveals iPhone 4 Tariffs, Scraps 'Unlimited' Data

Gordon Kelly


O2  Reveals iPhone 4 Tariffs, Scraps 'Unlimited' Data

O2 seems really keen to cement its role as the network-we-all-love-to-hate...

Today it has broken cover and become the first UK carrier to provide details of its iPhone 4 tariffs. Given it faces more rivalry than ever before with T-Mobile and 3 joining existing Apple partners Vodafone and Orange you'd think they'd have to be pretty good, right? Wrong...

What the table below shows is all tariffs are largely in line with existing iPhone 3GS deals though with two vital omissions: firstly the cost of the handset itself on either PAYG or with a long term contract, and secondly the disappearance of O2's 'unlimited' data bundles.

Once more I'd expect handset costs to be in line with O2's current 3GS pricing with PAYG at £449 and £549 for 32GB versions. What is more controversial is data because, in all fairness to O2, it was one of the more generous networks when it came to caps having scrapped its fair usage policy in 2007. Now what we return to is a system of contract dependent allowances ranging from 500MB to 1GB per month and an unavoidable charge of £5 for every 500MB used after that (£10 per 1GB for those on 1GB caps).

Worse is you'll need to shell out at least £40 per month on any long term contract to get more than a 500MB allowance in the first place and even £65pm contracts offer no flexibility above 1GB. This is particularly frustrating since the multi-tasking functionality of the iPhone 4 (and coming to 3GS owners) will allow data hungry apps like Spotify or TuneIn Radio to run in the background meaning caps can be surpassed far more easily.

Whether other networks will adjust their policies to fall in line with O2's new rates or to try and better them remains to be seen...

In related news O2 has given customers stuck on existing iPhone contracts an out charging them a flat rate of £20pm for each remaining month of their deals. If you bought a 3GS on its first month of release you'll still have six months left meaning £120 to trigger your upgrade entitlement. Yes, it's not cheap - but at least you have the option...


O2 iPhone 4 Tariffs

O2 Early Upgrade Offer


June 10, 2010, 8:23 pm

Is O2 taking the mick out of us?

Regarding Early Upgrade, with £20 per month O2 will be making more profit than if someone remains on the contract. Because a handset on eighteen months contract costs £180(upfront payment) for a 16GB 3GS unit and £270 (£15 x 18) installments. Any additional cost on your contract is towards the airtime and internet use. By early upgrading a customer is buying out the handset, not the airtime and internet, then why take £5 more? Pure greed!

Sensibly, it&#8217s not worth it. Except for FaceTalk, all features of iOS 4 will run on iPhone 3GS. FaceTalk is of no use because it is limited between iPhone 4 to iPhone 4 meaning your contacts should also upgrade to iPhone 4, what a marketing ploy!

Be patient, since handset is officially unlocked and available on all UK networks, buy your iPhone 4 when on holiday abroad and put a Pay&Go SIM, it will be cost-effective!


June 10, 2010, 8:24 pm

My initial reaction?

1. Save up for the inevitably vile PAYG price.

2. Just buy an iPod Touch (hell, maybe along with an Android phone).


June 10, 2010, 8:32 pm

Was going to ask why iPhone customers get special treatment when it comes to breaking their contracts but to be honest for the prices they get fleeced for it's probably only fair.


June 10, 2010, 8:32 pm

So what happens when the stupid 'I can't believe it's actually happening' iTimefAce video calling ifaCe thing, becomes available over 3G?! You're data allowance will be shot to bits in a few calls.

I can't help but think that in another 15 years Apple and Microsoft will have completely swapped places in the market. Apple continues to shoot itself in the foot - albeit in slow motion, and slowly morphs, almost imperceptibly, into everything that it once fought against.

And O2 is slowly regressing back to the noughties in terms of data costs and value. Common '3' - let's see some really aggressive pricing.


June 10, 2010, 8:40 pm

"charge of £5 for every 500GB "

I don't think many people plan on using 500GB of data. :P

Not impressed by these tariffs. O2 are just giving way too much room for rivals to undercut them...

evil mart

June 10, 2010, 8:57 pm

Not very impressed by this either, i've been a loyal o2 customer for several years, perhaps it's time for a change...


June 10, 2010, 9:03 pm

Jake: Very true, but will those rivals actually undercut them? Or will they simply offer the same atrocious tariffs, knowing that many customers really will pay almost anything to get their hands on the new iPhone?


June 10, 2010, 9:03 pm

I'll be switching to Vodafone, buying one on pre-pay with a sim only monthly rolling contract and getting a Sure Signal box...



June 10, 2010, 9:04 pm

Well, I was all set to upgrade with O2, not had any issues etc. But I don't like this Cap, I probably don't even use that much either. But I don't like the idea of some background task accessing the network, and only finding out when I get a big bill from O2.

Lets break down what 500MB equals. About 17MB per day.

IOW: If your a Spotify fan, then listen to about 6 new tracks a day and you'll be getting charged from O2. Absolutely bonkers.


June 10, 2010, 9:19 pm

Don't expect other networks to be any better.


June 10, 2010, 9:35 pm

This is a telling moment, it was so very disappointing back when the other major networks got the 3GS that there wasnt any competition in pricing between them. O2 have come out with some frankly shocking tariffs (although I would argue that it is better that they have dropped the stupid "unlimited" term when it never was unlimited) so here is an opportunity for the other networks to undercut O2.

I am really hoping that 3, as the one network that really seems to understand the way that the mobile networks are going (i.e that networks are just dumb pipes providing mobile internet), come out with some competitive tariffs. TBH theres fat chance of that tho...


June 10, 2010, 9:40 pm

Hmm I love it when a plan comes together! A phrase from a another time due to be reprised this summer but it may well apply to Apple who knows. Networks can be knocked and everybody will likely do that for iPhone 4 pricing but mark my words, control rests in one place and it's not at any UK network Headquarters.


June 10, 2010, 9:45 pm

Gordon - edit required:

First paragraph after the table - last line MB not GB and again in first line of second paragraph after the table :) Jake already spotted one of them but you probably been a busy guy!

I'll be heading to Vodafone, not 'cause of this, because their network is better where I live, plus - although I do get 1 bar short of full 3G O2 signal here at home, when I go to call someone it mysteriously drops to the blue dot coverage, then not even that, then drops the call - d'oh!

Geoff Richards

June 10, 2010, 9:46 pm

It may not be a popular view (and one admittedly from a non-iPhone / Smartphone owner) but given 16GB or 32GB of local storage on what is in some regards an iPod that makes calls, I don't think it's unreasonable for iPhone owners to play music from local storage rather than streaming it down the 3G network.

Just because you can stream doesn't mean you should.

If 500MB a month isn't enough for "everything else" then that's another thing... (and that doesn't include breaking the boredom of a train journey by watching cats riding Roombas on YouTube either)


June 10, 2010, 9:50 pm

"a system of contract dependent allowances ranging from 500MB to 1GB per month and an unavoidable charge of £5 for every 500GB used after that ".

Actually that isnt my experience of how O2 works. They will almost certainly have a standing charge of per-megabyte usage, which will appear on your bill, at an extortionate rate (dont be surprised if it's something like £5 per 20 MB). The additional useage plan you describe is a bolt-on. This means that you have to notify O2 in advance when this is going to be, AND THEN cancel it before the next month commences. I fell foul of this, ringing them the very morning that a new month commenced, and still had to pay that month's charge. Very depersonalised, lacking any human compassion.


June 10, 2010, 10:04 pm

@ Geoff - Why shouldn't I be able to stream music down 3G - I pay £35 a month (more than a 20MB broadband with free daytime phone calls) + the cost of the phone (likely to be £200 or there about). I'm sorry but that sort of premium pricing should come with a premium service. I should be able to do what I want with the phone (bar tethering) for that sort of money. Its not like I'm on a £25 a month contract with a free phone or its 2002 any more. In my day to day browsing (not downloading) I consume about 500MB a day on a laptop due experiencing 'the full web experience'. If the network can't cope then they shouldn't be marketing this as an all singing all dancing phone since after using the advertised features for a couple of days you will have maxed out your data.

Marc Davies

June 10, 2010, 10:14 pm

It's not just data that's been cut, my current O2 iPhone contract gives me 600 mins/500 texts for £35, this has now been cut to 300 mins for the same price (unless I go for a lengthy 24 month contract).

I've requested my PAC code... Here's hoping 3 offer up something better...

Kashif Bhatti

June 10, 2010, 10:15 pm

Having spoken to O2, it seems that upgrading does NOT mean keeping my old T&Cs, i.e. unlimited data (wifi or otherwise)... well. I put up with O2's rubbish 3G network for 2 years, their everyday call-dropping, but no more... if everyone else has a data limit, then there are better networks out there. Cheers for the memories.


June 10, 2010, 10:24 pm

"I don't think it's unreasonable for iPhone owners to play music from local storage rather than streaming it down the 3G network. Just because you can stream doesn't mean you should."

Coming from a man who doesn't even own a smart phone! - I think you're missing the point Geoff - Networks should be moving forward, not backwards. It is not acceptable that networks should have surges in development followed my mass saturation and network failure, followed by another surge in network development etc... Networks need to evolve, goodness knows that the big Telco's can afford to do this with their massive multi-billion dollar profits year on year.

Just at the point when everything mobile is / was about to make the leap to cloud storage, video calling for the masses, on-line documents, streaming of music, video & games on demand, films on demand, the demise of wired home broadband and a plethora of other data intensive services, networks place draconian limits on data capacities (to go with their already woeful bandwidth rates), which their obviously trying to set up as the next golden goose. Not good news for the average consumer, great news for the big corporations and share holders though.


June 10, 2010, 10:32 pm

@ Stelph networks are dump pipes eh? OK if that is the case we'll let them strip out the intelligence so we in effect have plain two way radios. In no way are they dumb networks any engineer will tell you that same as ISP networks no such thing. What you actually mean is that you see no value in the investment that networks have made in order for us to use such devices. That it should now be at a cost and no more. In time to come maybe but actually as resources get more stretched and costly the only way is up not down with respect to costs. Hence the furore with iPhone 4 pricing it's not over yet you know!


June 10, 2010, 10:44 pm

@Geoff: I think you've just turned this into another 40+ comment thread :P.

@V.E: You more than likely speak the truth, sir (sorry, I'm being presumptuous; madam?).


June 10, 2010, 10:51 pm

As another poster has already mentioned, to stay on the same monthly price band, getting an iPhone 4 would actually be a downgrade in terms of my monthly tariff. I guess there will be plenty of people out there who will allow themselves to be ripped off in that fashion but I am not one of them.

I'll be switching networks when my contract runs out in a couple of months. Nice own goal O2 !!!!

Geoff Richards

June 10, 2010, 10:52 pm

@Andy: a modern smartphone sells for up to £500 sim-free. That's £27 a month across 18 months repaying that subsidy (which is what it is). The remaining £8 will go towards the 300 minutes of call time, or whatever on your plan. Comparing it to paying £20 a month for ADSL2+ is apples and oranges.

@lifethroughalens: I don't see that my lack of ownership makes a material difference. Maybe instead of buying a Blu-ray for £10 and watching it locally, I should stream 50GB of data down the net instead just because I can...

Don't get me wrong - I agree that networks need to evolve and improve, and there should be investment. But I can't help feeling the justification needs to be for genuine mobile data reasons, like location-based services or AR, or yes, plain old email / web on the go.

Moaning about data caps on the basis that you'd rather leech free music from Spotify instead of playing an MP3 locally won't win anyone over. And if I bought an HTC Desire tomorrow I don't think I'd feel any differently.

Geoff Richards

June 10, 2010, 10:55 pm

Oh, plus I recall you can run Spotify in "offline mode", having downloaded music via your PC, and authenticate once every 30 days. Mate of mine with a puny iPhone 2G does this, because he can't leech over GRPS. Seemed quite sensible.

@drdark - I don't normally get involved, but felt compelled. Shame we don't have threaded comments, eh? :(


June 10, 2010, 10:59 pm

@lifethroughalens: I read that the "Facetime" video calling will only work via Wi-Fi, not on 3G(seriously, the two things I most dislike about Apple - and I own a 3GS, have had it since March and for all the limitations it's a good bit of kit, so I'm not an anti-Apple fanatic - are: Steve Jobs apparent Messiah complex, and their penchant for giving things ridiculous names)

Plus their promo is making out that it's going to be a lifechanging thing, but video calling has been around for years now and I've still never met anyone that's used it.

I've also looked at the O2 Recycle site and the 16GB 3GS will get you £240 as a tradein. That just about nets off the cost of the £20-a-month early upgrade fee (and fair play to O2 - everyone else has to pay to terminate early so no reason O2 should let us do it for nothing). That means an early upgrade would leave me almost cost-neutral (since I didn't pay for my 3GS)

I also read that any form of video/music streaming via the 3G is against O2's T&Cs...so does that mean all these little visits I've been making to Tunein Radio and Youtube are technically breaching my contract? You'd think there'd be a warning! Any ideas on that score, Geoff or Gordon - are we not meant to do this?

Still, love or hate Apple, they are definitely stimulating the market and pushing the likes of HTC to make some very nice alternatives!

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