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iPhone in Australia – now for the bad news

Welcome folks from round the interwebs – this article seems to be getting widely read.

If you want to know a little more about what we do (run conferences for Web Professionals) take a look at our upcoming Sydney Conference. And please leave your thoughts on the issue of mobile data pricing plans in Australia.

Update: And in Episode 19 of the Annals of Gutless Cluelessness, on the eve of the iPhone release, Vodafone have finally released their pricing plans.

Further Updates. iPhone Atlas has details of plans from around the World. The good news – the Danish have even higher data prices than Australians. The bad news – well, everyone else in the world gets a better deal than us. What’s interesting is that in several countries, there are exclusive deals – and yet we, with competition among 3 carriers, are the worst off. Anyone from the Chicago School care to illuminate us as to why?

Original Article

There’s clearly a tonne of excitement in Australia (and elsewhere) about the imminent release of the iPhone. Personally, I think it is a beautiful device, and in particular it revolutionizes the user experience for the mobile web. In the US and elsewhere is has driven up the adoption of mobile web browsing enormously. And that is what has really excited me about the advent of the Phone.

A huge part of that increase in mobile web use has been driven by the arrival of affordable mobile data pricing. In the US, with a single carrier having exclusive license to sell the iPhone, mobile data plans start at $30 for unlimited bandwidth.

So, what’s the story here in Australia? Well, information is not that easy to come by – as per usual, mobile providers hide their plan details behind a welter of caps, small print, and details. Telstra even had a press release of pricing details, but for the life of me I can’t find anything other than news stories about the press release on the web.

So, I am currently assuming the data and mobile plans for the iPhone at Telstra and Vodafone are the same as for their other handsets, while Optus at least publishes specific information regarding plans and the iPhone (which may indeed be the same as for other handsets).

In short it’s extremely disappointing to say the very least. If this were my personal blog you’d be reading expletives right now. Here’s how it stacks up.

First up, the single largest contract block you can purchase is from Optus for 1GB (probably barely acceptable for serious on the go all the time web and data use). This will set you back at least $150 a month (and as much as $180). And as mentioned there’s no option for any greater data contract, and I’m not sure what happens if you go over 1GB.

Over at Vodafone (disclaimer I’ve used Vodafone for years, for mobile, and more recently 3G data modem for my laptop), I have to assume that the mobile data pricing is what we’ll get with an iPhone. As an indication, the maximum fixed price block of data you can get is a paltry 100MB, for $11.95 a month. Vodafone claim 4000 web pages for 100MB of data, I’d argue this is a pretty big overestimate. Safari developer tools tell me the front page of the SMH is over a MB! And it will auto refresh every few minutes. Vodafone’s own front page is 500KB, so you’d get about 200 views of that for 100MB. So I’d say in the real world, I’d put the number of page views in the hundreds, not thousands. Now, Vodafone do have a 5G data plan for $40 a month, on a two year contract. You can only get this for your laptop with their 3G modem (included in the contract price). If Vodafone were to make this an option for the iPhone, by rights they should have a lock on the market.

The last of the Australian carriers to have the iPhone from July 11 is Telstra. For non Australians, Telstra is the AT&T of the country – a former state monopoly, now uneasily part public, part privately owned. Telstra’s plans, while the subject of a press release that had widespread coverage, are not easy to find. The closest thing at their site I can find is for mobile data packs – where 10MB will set you back $85.

That makes every visit to the Sydney Morning Herald’s homepage $8!

Business users appear to be able to get the same amount of data for $29, but frankly, these prices make mobile web, and even email completely unrealistic, particularly with excess charges of $1 a MB.

Also, all of these plans, other than Optus, are for data only, and don’t include calls, SMS, and MMS. There may be better plans out there, but other than Optus, none of the carriers seem to keen to cut through the confusion, and tell us straight up what’s available. I’ve searched repeatedly both locally at these company’s sites, and with Google, and found nothing that tells us in any detail what plans there are that come with the iPhone.

So, how does this compare globally? Well, starting with the US, AT&T charges either $30 or $45 for unlimited data (personal versus business). Over in the UK, £30 (about $62 at today’s rate) gets you unlimited data, plus voice, SMS, etc etc.

Even in Canada, where there has been very public outrage over the charges on Rogers, they get 1GB for $100 (including voice, text, etc etc) or 2GB for $115. So, if they are getting ‘rogered’ in Canada, what are we getting here?

So, is this really a big deal?

OK, in the scheme of things, this is not really a huge deal. World hunger is a big deal. But, this is not just the lament of some yuppie who wants a cheaper phone deal. To me this will actually have a huge impact on Australia’s capacity to become a serious player in the next wave of web innovation – mobile web applications and services. People simply won’t use mobile web services (except the “free” access to carriers own services – my bet is that this will come soon enough). Which means little if any incentive for local companies to innovate in this, a space with almost limitless potential. In markets with inexpensive data charges, all the innovation will take place, and when affordable mobile arrives here, those innovators will be ready to swoop on our market, with local companies in no place to play catchup.

This is an area in which Australia already punches above its weight. Google Maps started life in Australia, and a significant part of its engineering team still works here. Mapping will grow phenomenally with the advent of affordable mobile web services – mapping is so much more relevant when you are actually out and about than sitting at your desk. Remember the Milk, just won the first ever Apple Design Award, from Apple itself, for the best iPhone Web Application, beating out folks like The Associated Press (AP).

But to me, all that will be a thing of the past.

So, what to do about it?

First up, I’d not sign up to a contract until this changes. You’ll be locked into ludicrously expensive rates for a year or two, rates that we can only hope will come down. Hopefully too, the fewer folks who buy an iPhone right away will put pressure on the carriers to make realistic data plans available, and hopefully bring some pressure to bear on Apple to help persuade the carriers that it is in everyone’s best interest (carriers included) to make data plans realistic. I’d go so far as to say most of the plans I reviewed are essentially false and misleading advertising. 100MB is in no way a usable data plan for even lightweight mobile web usage, and customers will find themselves very quickly going into the extremely expensive over usage charges that will see horror stories of thousands of dollars of data charges in the coming months. Right now the carriers have a golden chance to get a large number of people using mobile web services. They look poised to cook the goose, rather than benefit from years of golden eggs. If even one of them does something like Vodafone’s 5GB for $40 for laptops, then they will own this space in Australia. Who has the guts to do that?

Then, well, I don’t know whether petitions are of much use, but feel free to leave a comment here that might indicate some level of agreement – maybe even committing to not get an iPhone until this is addressed. Frankly, you’d be mad to do so. We have promised an iPhone to one person who signs up to the conference by July 11th, and of course we’ll honour that, but we’ll happily translate that into your money back for the conference – basically you get to come for free, which translates into about the unlocked price of the iPhone.

Apple themselves have a huge financial interest here too – not just in iPhone sales, but with Mobileme subscriptions. Mobileme is the successor to .Mac, and makes data-synchronization of emails, contacts, events, and more across multiple web connected devices a total no brainer – but it will use a lot of bandwidth – in Australia you’d be close to insane to sign up for this (something I was going to do on day 1, right after getting an iPhone). That will be on hold now.

I had optimistically held out the hope that our carriers practices of horrendously overcharging by world standards was going to be addressed here, as it has been with the launch of the original iPhone in the US, UK, and the rest of Europe. Sadly, this is very very far from the case. I had hoped this would spur a huge burst of Australian innovation around mobile web services and applications. With the cynical Australian business culture, all we’ll hear is how there aren’t any customers for your great application to help people find the cheapest petrol at any given moment, wherever you are, because “no one uses mobile web”.

A year or two from now, this will doubtless be addressed. But it will be too late by then. Disruptive moments don’t have large windows of opportunity before the early adopters turn that advantage into market dominance. That creaking sound is the sound of that window of opportunity closing.

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