UPDATE: Apple to Slash iPhone Retail Price in the UK

As expected - although a day earlier than planed - O2 UK has announced that it is cutting the price of the 8GB iPhone by £100 to just £169 (US$333) until 1 June 2008. The offer is available from tomorrow (16th April) on all O2 iPhone tariffs. The 16GB iPhone remains priced at £329.

Once purchased, customers will continue to be able to choose from one of O2Ã's three iPhone tariffs, starting at £35 per month. Each tariff includes unlimited data browsing and free access to The CloudÃ's 7,500 Wi-Fi hotspots.

O2 says that 60% of iPhone customers are new to to the network, while iPhone customers spend on average 30% more than other Pay Monthly customers.

Ominously, the company warns that the special offer is subject to stock availability - a matter of some concern recently with ongoing reports of stock shortages of the handset.

Speculation is rife that the price cuts are to clear out the remaining stocks of the handsets prior to a long awaited launch of a 3G model of the handset. Piper Jaffray analyst Gene Munster in a note to clients last week, said iPhones couldn't be found at Apple's hundreds of U.S. retail stores. Piper's Munster reminded his clients in the research note that when Apple products disappear from stores, an update of that same product often follows in a few days. Given that history, Munster sees an 80% chance that Apple will soon introduce an iPhone for 3G networks.

Sales have been weaker in Europe than had been expected, which has been put down by analysts to the lack of 3G capability in the phone.

Posted to the site on 15th April 2008