Is this a Vodacom / MTN dirty little secret?
Why has the iPhone (all versions) been so expensive in South Africa since it’s launch?
The question first emerged when I heard someone (when the iPhone was first launched in SA) suggest that Vodacom (the first SA supplier) couldn’t afford to price the iPhone anywhere close to International pricing levels because of how they’d priced the other phones in their stable. The way it was explained was that phones were priced based on quality, brand, features, etc, etc. Entry level phones where cheap and smart phones were expensive. This makes sense. If they priced the iPhone at international levels how would they sell their top end Nokias, Blackberrys, Samsungs, LGs, HTC’s, etc, etc. The iPhone was a top end phone, and top end phones got top end prices.Messing up their market was apparently more important than passing on the savings to their customers.
But if you remember back to the launch of the iPhone, one of the defining ‘features’ was that Apple came in with an exceptional phone priced at a ridiculously low price (in the US anyway). It was one of the reasons the iPhone became the big seller it did in the US and gained such a massive market share so quickly.
In South Africa many of us anticipated and hoped that it would be the same in South Africa. And of course it wasn’t. Getting an iPhone on contract required us to throw a fairly large chunk of change at the problem in order to secure one. We didn’t get the benefit our counterparts in the US did. We were disappointed and we ended up shelling out the money. What choice did we have?
A few weeks ago the iPad was launched in South Africa. The iPad has come into the country via The Core Group (the official Apple agent in SA). Entry level iPad’s are being sold at around R4300. 16gb of memory, and wifi with no 3G. It’s this that got me writing today’s post.
In my mind the iPad is a superior product to the iPhone. However you cut it, it must be more expensive to build, transport, store, etc, etc. So why is it at least 50% cheaper than an iPhone? The only difference I can see is that the iPhone is distributed through Vodacom and MTN and the iPad through Apple (via The Core Group)
In researching this post, I’ve found it difficult to get exact prices on iPhones. So while I can’t absolutely confirm the numbers I’m about to quote, I do believe they’re pretty close, based on the number of articles I’ve read and the numbers I’ve seen. I finally settled on data from Memeburn (a great SA resource for tech news and information)
In their article, ‘Comparative pricing study: How do you like them Apples?‘ they suggest:
- we’re paying R4399 for an entry level iPad (16gb), which is 21% more than our US counterparts
- and between R7000 – R7999 for an entry level iPhone 4 (16gb) – no US comparison offered.
I’d like an answer from someone (anyone) as to why this is so? The only credible explanation I can come up with is that the iPhone prices are so high because Vodacom can! And why hasn’t MTN launched the iPhone 4 at international pricing levels? I can’t confirm for sure what they’re selling the iPhone 4 at on Pay-as-you-go (there seems to be so little information available) but if they’re anywhere close to Vodacom, it’s because they can as well.
You’d hope there’d be a credible explanation, but the cynic in me thinks not. I’d like to be surprised. I’d like to know if this is a dirty little secret or not?