Today, Everything Everywhere, the JV between T-Mobile and Orange in the UK, confirmed that it will be selling the Apple iPad for more “affordable prices” – thought to be in the region of £200 ($320), for those who take a two-year contract with either operator.
This is a pretty massive discount on the normal retail price of £429-£699 ($688-$1,121), and is thought to be the first example of an operator subsidising the tablet device. Everything Everywhere has not confirmed prices yet; the £200 tag was reported by the NMA and several other publications.
It’s also another example of the extent that retailers going to bring in belt-tightening holiday buyers: In the UK, rival operator O2 began to offer existing subscribers a Kinect instead of a handset, if they renewed their contracts for another two years. And in the U.S. discount retailers TJ Maxx is selling the iPad for $399 at selected locations, a discount of $100 off the normal retail price.
The initiative is one of the first from Everything Everywhere aimed at the consumer market, and points to the new kind of bargaining power that the combined operator, with 27 million subscribers, now has in the mobile-friendly UK to get to this deal first. (The JV officially kicked off in October with a £4 million ad campaign.)
However, this might not be the end of the discounts: a spokesperson for Everything Everywhere says that the deal is not exclusive, and so we could expect more of this from other providers, too.
The announcement comes in the wake of TJ Maxx in the U.S. selling iPads in select retail locations for $399 – a $100 discount on the lowest iPad device on sale through the Apple (NSDQ: AAPL) store.
With the TJ Maxx discount, there is a lot of debate around why the premium, and still relatively new, iPad is selling at reduced prices: it may have something to do with Apple preparing for the next edition of the device, and therefore moving stock; but it might also simply be a move to increase volumes in the midst of a tablet onslaught from competing makers, hitting shoppers in time for the holidays; or it could just be a loss leader for TJ Maxx, in their push to get more footfall going past their other products.
The case, apparently, is different with the iPad going on sale with Orange and T-Mobile: the spokesperson says it is the operator that is doing the subsidising and discounting here, not Apple.