Apple iPad in the UK: Regional Release Update

After Steve Job’s confirmation on Wednesday that the new Apple iPad will have a 3G option, British mobile phone operators and high street stores are scrambling to win the much-coveted contract AT&T have already snapped up prior to the product’s launch in the US. Major mobile service providers Orange, Vodafone, O2, T-Mobile and the high street sales outlet Carphone Warehouse are all thought to have expressed an interest in the device within 48 hours of the launch, with a bidding war similar to that preceeding the launch of the iPhone expected to get underway over the coming weeks.

Orange seems to be the early leaders, having already held talks with Apple over the device. The company are talking of an exclusive UK deal, similar to the deal O2 snatched from under their noses just over two years ago for the launch of the iPhone, and will be looking at offering a subsidy on the initial purchase price for customers who sign an Orange contract. Orange are hoping the cheaper sales price (and so inevitable increased sales) of a subsidized exclusive role will convince Apple that restricting the device to only one network is a good idea. Vodafone and O2’s early indications suggest that they are less confident an exclusive deal is achievable, especially given early indications in the US, where Apple seems more interested in allowing its customers to access the device unlocked and choose their own network supplier. The two companies will instead be attempting to simply be one of a number of iPad suppliers.

As well as Orange’s interest, which appears to be specifically aimed at the UK, T-Mobile has also already spoken to Apple, though they are doing so on a wider scale, attempting to secure access to the iPad on a Europe-wide level. Carphone Warehouse’s has also declared an interest, and will be hoping to tie up a ‘third party exclusive’ similar to their previous deal for the iPhone a few years ago.

Any use of a subsidy in the sale of the iPad relies on the company providing it making the subsidized money back over the duration of a contract, something that’s been put into doubt after the US launch of the iPad (and its AT&T affiliation) saw the product effectively restricted to short rolling contracts. Companies like Orange would require a standard contract of a year or more before they would be looking to implement a product supplement, as a shorter period of time would simply not allow for their subsidized money to be made back.

Nevertheless, it’s difficult to rule out the idea of a subsidy entirely, in part because Apple has refused to announce any UK prices until the US launch date in March. As the price would be expected to be a simple case of factoring in the costs of UK sale, taxes etc and altering the US price, the refusal to publicize it seems to suggest a subsidy might be more likely than it first appears. The lack of a long-term contract, of course, has significant downsides for operators (including the lack of a regular income on which to plan investment, and the ever-present possibility that users might take up any offers given by a rival), but can only be a positive for consumers. The only downside of the lack of a long term contract for users is that they can expect the initial outlay on purchase of the iPad to be higher; not such a bad thing considering the US prices announced on Wednesday were significantly lower than expected. A best early guess for UK prices for the iPad, though, would put the cheapest model at around £325.

Another factor to consider for those using a regular mobile service provider’s internet service is that the iPad will use a smaller variety of SIM card (a micro SIM card), as opposed to the more standard model, so the option to simply put your existing SIM card into the iPad doesn’t exist. Having said that, Xingtone fully expects to see service providers launching combined packages for laptops and iPads, including the micro SIM card, nearer to the iPad’s late spring launch date.

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