Buying an iPhone 4?

Mobile operators, Maxis and DiGi launched Apple’s latest version of the hugely popular smartphone, the iPhone 4, with some fanfare last week.

The smartphone, first unveiled during the 2010 Apple World Wide Developers conference in early June, has enjoyed brisk worldwide sales since then — despite the highly publicised antenna attenuation issue.

Indeed, it would appear that most Malaysians are unfazed and have been eagerly awaiting the arrival of the iPhone 4 based on last week’s reports of long queues. DiGi indicated that some 30,000 people registered their interest in the product prior to the launch.

Interestingly, the two telcos have decided on somewhat different pricing strategies to attract subscribers. Maxis is offering much higher handset subsidies on the back of more costly data plans. DiGi, on the other hand, has opted to keep handset subsidies to a minimum and is offsetting the higher phone prices with cheaper data plans.

Maxis or DiGi?
For those deciding between the two operators, we have summarised the packages offered and the monthly costs, including the price of the phone over a 24-month period.
DiGi offers subscribers a cheaper entry point. Its lowest package is priced at RM153.20 per month, assuming a 24-month contract and instalment for the phone over the same duration. For those who sign up for auto-billing, there is an additional RM5 rebate off the monthly bill. In this case, the price of our cheapest package example would be roughly RM148 per month — compared to Maxis’ cheapest package costing RM163 per month.

Subscribers should also note that Maxis charges for additional data download exceeding the package quota, up to a maximum of RM250 per month, and its free SMS and MMS are only applicable for Maxis to Maxis lines.

As a rough guide, studies undertaken in the US indicate the current monthly data consumption for iPhone users average around 300MB to 400MB per month. The actual data consumption, of course, depends on the individual user.

On the other hand, Maxis boasts of a wider 3G network, its coverage extending to about 60% of the nation’s population. DiGi’s coverage stands at roughly 35% but is targeted to rise to 50% by end-2010.

Both companies are expected to continue expanding the width and depth of their networks to cater to the rapid growth in data consumption. In particular, growing popularity of streaming applications is expected to raise data consumption levels exponentially over the next few years.

Written by Insider Asia

Note: This report is brought to you by Asia Analytica Sdn Bhd, a licensed investment adviser. Please exercise your own judgment or seek professional advice for your specific investment needs. We are not responsible for your investment decisions. Our shareholders, directors and employees may have positions in any of the stocks mentioned.

This article appeared in The Edge Financial Daily, September 29, 2010.