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Within the UK, users of cellular phones prefer prepaid pay as you go plans by a large majority over conventional contracts. These pay as you go plans allow users to buy a certain number of minutes in advance and often have monthly fees as low as eight pounds. Among users who often travel to mainland Europe, these plans are even more prevalent. Although the monthly fees are lower, those who choose the pay as you go option often do not receive subsidized prices for their phones, so a higher upfront out of pocket expense may be necessary especially for those who prefer higher end phones.
O2 offers a pay as you go plan for the iPhone. According to AppleInsider.com, the 8GB iPhone 3G will run you 621 pounds under O2’s pay as you go plan, while the contract plan offers the same phone at a subsidized price of just 99 pounds. A difference of 521 pounds for the cost of the phone and a savings of only 22 pounds per month using the lowest price alternatives under each type of plan. Furthermore, under the pay as you go plan, some f the iPhone capabilities are reduced. On the Fly Call Merging and the popular Visual Voicemail applications are not offered with the pay as you go plan.
For some, the lack of an onerous long term contract outweighs the initial cost of the iPhone with a pay as you go plan, but clearly O2 seems to be attempting to use the popularity of the iPhone to direct users into choosing a contractual commitment instead of the pay as you go option. The monthly contract is much more lucrative for O2 or any cell provider than the minimal pay as you go plans. If not for the overwhelming preference for pay as you go plans by the UK consumer, O2 would clearly have reserved the iPhone exclusively for its long term contract plans.
The O2 pay as you go plan does offer some incentives, though. It includes, for example, one year of free internet access within the UK using 3G or O2’s wifi network. After the first twelve months, however, the price of this unlimited access jumps to ten pounds each month. Text messages, though, says AppleInsider, cost extra right from the start at 10 pence apiece. Users with a heavy texting habit will want to avoid this plan.
The iPhone and O2, however, do not have the smart phone market, nor even the touch screen phone market exclusively to themselves. Rim’s blackberry and other touch screen models are available from other cell phone service providers under a variety of different plans. Many cell phone providers in the UK offer quite substantial free gifts to new customers when they sign up for cell service. To see the latest prices, promotions, phones, and plans, visit ThePhoneNetwork.co.uk where you can compare the various offerings side by side or sort through a list according to features that matter to you.