Telecom follows Vodafone in hiking iPhone 4S pricing

UPDATE Dec 12: Telecom is following Vodafone's November 25 move and raising iPhone 4S pricing on its cheapest plans.

From midnight tonight, a 16GB iPhone 4S on a $40/month plan will increase from $649 to $899 (still cheaper than Vodafone's closest offering, which has an iPhone 4S on a $45/month plan on $949).

The same model on a $60/month plan will rise from $549 to $799.

On the upside, Telecom says an increased subsidy applies for the iPhone 4s 64GB on a 24-month $140 Smartphone Plan, changing the up-front price from $199 to $0.

A Telecom spokesman said delivery times were unchanged. Tight supply has seen Vodafone list multiple iPhone 4S models as out-of-stock on its website. The same problem saw Telecom stop selling the iPhone 4S off-contract. Apple's website lists a 1-2 week estimated delivery time for all models.

Telecom's current iPhone 4S pricing:

It's pricing from midnight:

Vodafone increases iPhone 4S pricing; Telecom doesn't; shortages strike both carriers

UPDATE Nov 25: We've seen the first major movement in iPhone 4S pricing - and it's upward.

From midnight tonight, Vodafone will increase the price of a 16GB iPhone 4S on a $45/month 24-month plan from $649 to $949 - just $100 under the Apple online unsubsidised price of $1049. Telecom is selling a no-term 16GB iPhone 4S for $1029. (UPDATE, Telecom has just told NBR, "Due to high demand, at this time we are prioritising customers who want to take up a contract with the iPhone 4s, so the iPhone 4s is currently available on a contract only).

A series of price increases will be applied to 16GB, 32GB and 64GB iPhone 4S handset pricing with Vodafone's Smart 45 ($45/month) and Smart 65 ($65/month) plans.

Telecom is selling a 16GB iPhone 4S on a $40/month 24-month plan for $649.

A spokeswoman told NBR there were no plans to change pricing (scroll down for full pricing tables).

A Vodafone spokesman said initial strong sales of the iPhone 4S meant it no longer had enough supply to warrant maintaining its handset subsidies of up to $300 on iPhone 4Ss with its $45 and $65 monthly plans.

Vodafone is not offering the iPhone 4S standalone, because of the same supply issue.

At 4pm today, a Vodafone spokesman told NBR, "We received a shipment yesterday. However we envisage that this stock will not last too long as demand still remains high."

UPDATE II Nov 10: Two days after Telecom's surprise entry into the iPhone market, Vodafone has played its hand, revealing contract pricing ahead of the 4S's Friday launch.

“We think customers are going to love the value we are offering on iPhone – especially given how much Kiwis love to call and TXT. And we have no charge for calls to voicemail. Already anyone who signs up for a Vodafone Smart Plan contract gets an extra 1GB of data every month for six months,” said Grant Hopkins, director of sales at Vodafone New Zealand. 

Translation: we have more emphasis on calls and txts than Telecom, whose plans (below) run up to 3GB. 

Keen readers will note Vodafone's 3GB free data bonus with the iPhone 4 and other smartphones has morphed into 1GB with the iPhone 4S (people who bagged the 3GB deal before August 23 can keep it for the lifetime of their plan, however).

See Lance Wiggs' graphical breakdown of Telecom vs Vodafone vs 2degrees iPhone data pricing here.

Like Telecom, Vodafone is charging a punitive rate for those who overstep their monthly data cap - 20 cents a megabyte or $200 a gigabyte.

The 1GB free data add-on applies only for the first six months of Vodafone's new plans. After that, a 1GB add-on can be bought for $20 a month. 

However, only one data add-on in each category can be purchased per month (again, Lance Wiggs was quick to seize on the fine print, see his analysis here).

Another gotcha: You're not allowed to transfer between Smart plans during your 24-month term.

NBR encourages all readers to take advice recently given by lawyer and regulatory specialist Michael Wigley, of Wigley & Company. The advocate told NBR readers not to be shy of putting the squeeze their phone company - and to demand a discount whatever the headline rate. And don't shirk from making demands mid-contract, Mr Wigley said, such as asking for more voice minutes. Take advantage of the newly competitive environment.

iPhone 4S will be available at selected Vodafone stores and online from 12.01 am on Friday, November 11. These stores include Queen St, Auckland; Lambton Quay, Wellington; George St, Dunedin; and Riccarton Mall, Christchurch. It will be available in all Vodafone retail stores from 9.00am.

While Telecom is featuring Dan Carter at its Auckland launch, Vodafone's Twitter account said this afternoon, "We heard a rumour that Midnight Youth will be performing at Vodafone Queen Street Auckland tonight from 10pm."

Vodafone's plans (click to enlarge):

Vodafone's full iPhone 4S details are at Vodafone.co.nz/iphone.

Telecom's full iPhone 4S details are on Telecom.co.nz/iphone.

Apple's direct sales are here.

Telecom's pricing (see more below):

UPDATE Nov 10: Telecom is drawing on its All Blacks sponsorship to help promote its iPhone 4S launch. Dan Carter will appear at the company's Auckland concept store (at 167 Victoria St West) from 11pm on Thursday. The new iPhone will be launched at midnight.

Mr Carter's last high profile midnight tech launch was for Microsoft's Windows Vista. Telecom will be hoping the iPhone 4S fares better.

Vodafone has yet to detail contract pricing or open pre-orders for the new iPhone, now less than 24 hours from its official local release.

A less-than-perfect Wednesday for the carrier also saw news it lost 50,000 customers in the half year to September, and sentencing in its $1 a day/misleading mobile broadband advertising case adjourned until Monday in the Auckland District Court.

UPDATE Nov 9: Entrepeneur and industry commentator Lance Wiggs was quick to criticise that the maximum amount of included data was 3GB - limited in his view - and that a customer had to get a plan that included 2500 txts and 500 txts to get it.

Mr Wiggs wanted to see a plan for more data intensive users (see his full analysis here).

Asked to respond to Mr Wiggs' critique, a Telecom rep told NBR "Our smartphone plans are currently the most data intensive plans in the market" (an analysis that ignores Vodafone's temporary 3GB a month free data bonus, recently reinstated with a little encouragement from NBR).

A mobile broadband plan could be used to "boost" an XT smartphone plan, the Telecom spokeswoman said. If you don't take a supplemental plan then, Mr Wiggs pointed, out, you'll get stung with a 10 cents per megabyte (or $100 per gigabyte) charge once you pass monthly limit, which ranges from half a gigabyte to 3 gigabytes depending on your iPhone 4S plan.

Meanwhile, two days out from the iPhone 4S's official launch, Vodafone has yet to open pre-orders, or reveal its contract pricing. A Vodafone spokesman told NBR the company had finalised its plans, but could not say when they will be made public.

Going second will give Vodafone the chance to react to Telecom's plans - but with Telecom orders already open (and the company claimed problems on its order page yesterday were caused by overloading), some of the horses have already bolted.

Telecom shares [NZX:TEL] finished yesterday up 2.09% to $2.69. In early Wednesday trading they were up a further 1.49% to $2.73.

UPDATE Nov 8: Telecom will sell the iPhone 4S from this Friday, November 11, the company said in a statement this morning.

The telco - which has never before officially carried the iPhone - has also beaten Vodafone to the punch in announcing contract plan pricing (see table below).

It has also stolen a march on its rival by opening for pre-orders through its website (early afternoon, some early buyers were reporting a 404 error message when they tried to place an order; Telecom blamed overloading). Vodafone has yet to open its iPhone page for business.

To add insult to injury, Telecom is also monopolising Google's paid search for iPhone 4S.

Telecom's "no term" pricing is $20 cheaper than Apple's online store for the 16GB iPhone 4S ($1029 to the Apple Store's $1049). No term pricing for the 32GB model ($1199) and the 64GB model ($1349) are the same as Apple's website. The Telecom-sold iPhone 4S (like Vodafone's) will not be locked to its network.

A rep for Vodafone this morning told NBR the company has set its contract pricing, but is yet to decide when to reveal it. The carrier has yet to open pre-orders.

A spokesman for 2degrees said it had "no immediate plans" to sell the iPhone 4S.

iPhone 4S will be also be available through Telecom stores. From 12:01am this Friday, the 4S will be sold through Telecom concept stores in central Auckland (167 Victoria St West), central Wellington (42 Willis St), Christchurch (Moorhouse Ave) and Dunedin (101 George Street). iPhone 4S, iPhone 4 and iPhone 3GS will also be available from all other Telecom stores nationwide from 9:00am.

Telecom's plans:

Click to enlarge. All for two-year plans. 1000MB = 1 gigabyte (1GB).

Telecom Gen-i division boss Chris Quin recently told NBR about his experiences using the iPhone 4S's "virtual assistant" feature with a Kiwi accent. Read his account in NBR's Siri round-up here.

The company has previously sold micro-SIM cards suitable for the iPhone and iPad, and made the iPhone available through Gen-i for corporate customers. It also has a forever-extended rebate offer of up to $800 for those who bring their iPhone business (or other smartphone account) to XT.

UPDATE Nov 4, 1pm: Apple's NZ online store has just opened for iPhone 4S preorders, with a limit of two per customer and a ship time of one to two weeks.

Vodafone has placed a brief blurb about the iPhone 4S on its website, plus a note saying the new model will be available online, and in Vodafone stores, from November 11.

A 2degrees spokesman said the telco had no immediate plans to carry the iPhone 4S. He wouldn't comment on whether there had been any talks with Apple.

Telecom declined comment.

UPDATE Nov 3: The good news: as first-reported by NBR yesterday, the iPhone 4S will be available in New Zealand from Friday, November 11, with pre-orders opening this Friday, November 4.

The bad: Kiwis will have to pay more - up to $265 more - than Americans for the much-hyped handset.

And Apple has still yet to comment on whether the vaunted Siri voice-recognition feature will be programmed for the New Zealand accent (although NBR has polled local early adopters on their experience; keep reading).

Local pricing will be:

• 16GB: $1049
• 32GB: $1199
• 64GB: $1349

The price of the current iPhone 4 has already been reduced to $899 (with memory chopped back to a single 8GB option) and the iPhone 3GS to $599.

US pricing (expressed in NZ dollars at today's exchange rate, with the US off-contract price in brackets) is:

• 16GB: $829 ($US649)
• 32GB: $957 ($US749)
• 64GB $1084 ($US849)

In other words, Kiwis are paying $220 to $265 more than North Americans (US buyers do have to pay a sales tax on top of the above pricing, which ranges from 1% to 10%, depending on state).

Like iTunes music and apps, Apple's hardware pricing seems to take to account for the rise of the NZ dollar. Een allowing for GST, we're still paying a three-figure premium for the new iPhone.

Australia iPhone 4 pricing (again, expressed in NZ dollars at today's exchange rate, with the Aussie off-contract price in brackets) is much closer to ours.

16GB: $1054 ($A799)
32GB: $1186 ($A899)
64GB $1318 ($A999)

The traditional rationale for the iPhone being more expensive here is that the local version is unlocked. That is, it can be used not just with official carrier Vodafone; you can also pop in a micro-SIM from Telecom or 2degrees without any hassle, or loss of features. But in the iPhone 4S case, the US pricing is for models that, like here, are unlocked.

Vodafone hanging on the line
In its statement (covering multiple countries and not mentioning any specific carriers), Apple said the iPhone 4S would be availalbe through its online store, and authorised resellers.

Official carrier Vodafone has yet to reveal contract pricing. A spokesman declined to comment on if or when Vodafone would take pre-orders, telling NBR only "Details will be announced closer to launch." [UPDATE: Vodafone has now added a 4S preview to its iPhone page. The quick summary makes no mention of Siri.]

Asked by NBR to confirm that Vodafone would remain Apple's sole carrier in New Zealand, an Apple Australia-New Zealand spokesman would only offer, "We have not announced any carrier details yet." Pressed for detail, he repeated the same line.

NBR would be hesitant to read anything into that; Apple is famously oblique ahead of official product release dates. But it is curious the company would pass on a simple and straightforward opportunity to promote the telco that is (as your correspondent types) its only New Zealand carrier.

What's on the way
The 4S has an almost identical exterior appearance to the iPhone 4, but several hardware upgrades under the bonnet including:

• A5 dual-core processor - the same chip at the heart of the iPad2 (the iPhone 4 is single core)
• A new 64GB onboard storage option (the iPhone 4 topped out at 32GB; it's now been scaled back, in its new role as a budget model, to 8GB)
• Claimed battery life of 9 hours wi-fi browsing, 8 hours 3G talk time (iPhone 4: 7 hours). In Apple support forums, some have complained about poor battery life. TechCrunch has suggested a number of software bugs are to blame and has posted a list of fixes.
• 8 megapixel camera (iPhone 4: 5 megapixel) that Apple says captures 73% more light and is 33% faster
• Full high definition (1080p HD) video recording (iPhone 4: 720p) with image stabilisation (iPhone 4 has none)
• HSPA support for download speeds of up to 14.4Mbit/s (more than twice iPhone 4 theoretical maximum). Vodafone 3G and Telecom XTs support HSPA
• All new external metal antenna design (presumably eliminating the call degredation/dropped call issues that plagued the external antenna that debuted with the iPhone 4)

But reviewers have increasingly focused on "Siri", a personal assistant feature that allows natural language commands and questions (for example, "When was my last haircut?". General knowldege queries are answered with help from WolframAlpha.com).

Despite being left off the original New Zealand iPhone 4S announcement page, Siri is listed as a feature for the New Zealand release. (Asked earlier about Siri being included with the local release, an Apple rep told NBR, "Siri is a Beta product that is shipping in the countries that iPhone 4S is shipping.")

Judging by the experiences of New Zealanders who've picked up an iPhone 4S overseas, Siri does a reasonable job of handling the Kiwi accent.

 "Siri is fine. You just need to talk slowly and clearly. Don't mumble," Telecom Gen-i chief executive Chris Quin told NBR.

Tech entrepreneur Seeby Woodhouse said Siri, "Does work better if I put on an Aussie accent, but it's pretty flawless. I'm just floored by how much it understands. It's amazing."

(A number of hardcore Apple fans have "jail broken" the latest version of Apple's iOS software so that Siri - specifically designed for the 4S - can be run on an iPhone 4. NBR says proceed at your own risk. Messing around with jail breaking isn't recommended unless you're very technical. Additonally, voice-recognition is very processor-intensive, so could be expected to work better on the more powerful 4S.)

Another high-profile feature, iCloud online storage and synchonisation, is also available as free upgrade for older iPhone models.