Originally Posted by anantksundaram
You may be right, for all I know. But Apple's market research probably currently tells them otherwise, hence their actions that frustrate you.
But if you're right, then I have no doubt that a company such as Apple -- or any half-way smart company, for that matter -- will change its strategy accordingly.
No, I think their market research tells it like it is, and they will change their strategy at some point. I found some statistics for 2004. In Europe, the Middle East and Africa, there were 427.6m pre-paid mobile users. Worldwide, it was 809m. http://www.epaynews.com/statistics/mcommstats.html#24
I also found this:
"In Europe, the vast majority of mobile subscribers are prepaid users: .....Prepaid accounts for 79% of new users in Europe, and 60% of European users overall"
So anyway you care to look at it, Apple is choosing to eschew the largest market segment.
I can think of two reasons for their attitude. Firstly, they think the iPhone is so wonderful pre-paid users will gladly switch to contracts in order to get one. If they think that, I think they are sorely mistaken a few will, but not very many. I know for certain the Irish market, is mostly prepaid, but that matters for nothing because the overall market size is tiny. But Italy is a different matter. The market there is almost all prepaid and there are 60m people - in other words it is a market the same size as the UK.
Secondly, I think they are initially aiming to skim the cream by shafting the early adopters because they don't have a 3G version ready. So in the initial stages of European market penetration they are setting out to bleed as much money as possible from those who are easily parted from their money - a group more commonly referred to as fools.
These early adopters will pay through the nose for a status/fashion symbol they can ostentatiously flaunt and flash about. This will be the cream skimming stage. Then when the fools have been well and truly plundered the 3G models will be available and they will hit the prepaid sector of the market.
The fools are going to scream like stuck pigs when that happens, but not too loudly in case they look like fools, and Apple is going to thumb it's noses at them, as it usually does to early adopters.
Well thats my slightly cynical view of things.