European operators slash iPhone prices

Slowing sales and the likelihood of a 3G version becoming available within a few months are being blamed as the cause for dramatic price cuts to Apple's iPhone. O2 and T-Mobile in Europe have aggressively reduced their prices of the basic 8GB version to around €199 and €99 respectively.

O2, which has the iPhone under an exclusive deal with Apple, said the decision to launch its price promotion, which will run until June 1, "will create additional momentum for what has been O2's fastest selling device."

Others in the industry, however, believe sales have been slowing down. O2 maintains it has hit its target of several hundred thousand phones sold since launch, but after the initial hype died down, sales are believed to have slackened off. The company recently resumed its TV advertising campaign for the phone.

O2 maintains the iPhone has been key to attracting new high-value customers, with 60 per cent of iPhone customers new to O2 and 30 per cent of iPhone customers spending on average 30 per cent more than others on pay monthly tariffs.

For more on this story:
- read The Guardian

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