New iPhone 3G set to tempt prepay customers towards a contract

London, 8 July 2008 - The new iPhone 3G looks set to tempt a considerable amount of prepay customers towards taking up a contract, according to new research.

The research, carried out by GfK NOP a week before the iPhone 3G launch on 11 July 08, reveals that the stock shortages which may hold back the launch of the pre-pay tariff till the end of the year will not deter current pre-pay users from getting an iPhone 3G. When presented with O2’s set of contract tariffs as well as the pre-pay deal leaked a few weeks back, 16% of pre-pay users said they would consider taking up one of the offers. Interestingly, two-thirds of these pre-pay users are prepared to sign up to one of O2’s 18 month contracts to get it.

The launch looks set to be very successful; looking at the full market (contract and pre-pay), one in five mobile owners (20 per cent) said that they would be interested in purchasing the new handset on one of the new handset / tariff packages within the next 6 months. A further 7 per cent said they would also be interested in getting the iPhone 3G, but not at the current tariffs.

Anders Nielsen, Director at GfK Technology comments, "The message from the research is very clear; the blend of handset subsidies, sensible tariffs and the improved technical specifications will combine to really drive demand. O2 and Apple have addressed most of the barriers which held back mass-market take-up of the original iPhone, so we expect the iPhone 3G to sell well. In addition to selling new connections, the research shows that the new iPhone offers will also help convert some pre-pay users to 18 month contracts which, in turn, could contribute positively towards O2 customer retention and ARPU levels.”

Awareness of the new Apple iPhone 3G is mostly centred on the new handset features.

The iPhone 3G may not have generated quite the same level of publicity as the first iPhone, but nevertheless almost a third (32 per cent) of UK mobile phone owners are aware of the new Apple iPhone 3G. Amongst these, awareness is centred on the new handset features, with over half being aware of the improved 3G data speed (56 per cent) and the improved memory of 8 or 16 GB (54 per cent), but there is also good awareness of the different range of tariffs and handset prices on offer.

Awareness also high amongst Silver surfers!

Unlike so many other handset launches, the Apple handset seems to have captured the imagination of the wider population, not just early adopter or youth segments. Awareness levels are high across all age groups, but of particular note is that nearly three quarters (72 per cent) of 60+ year old mobile owners are aware of the iPhone, not all that far behind the 97 per cent awareness amongst the more obvious 16-24 year old group.

About the survey

The survey was conducted by GfK NOP between 4-6 July and consisted of 750 online interviews, weighted to give a nationally representative sample of UK mobile phone owners.