O2 bracing for glut of iPhone returns?

With the announcement of both Orange and Vodafone securing rights to offer the iPhone in the U.K. in the coming months, a number of O2 customers may be looking to take advantage of a two-week window in which they can return their devices and wait for possible better tariff rates and contract terms on competing carriers. The Telegraph reports that as many as 30,000 O2 iPhone customers may be eligible for returns, and the company says it is not planning to offer unhappy users a better deal in order to keep their business. The article suggests that the competition between carriers will knock around £5 (roughly $8) off the average monthly iPhone tariff, resulting in a savings of about £100 (~$160) over the course of a two-year contract. “There will be a price war,” said Steven Hartley, analyst at technology research house Ovum. “Research shows that in every country where there is more than one operator selling it, it is cheaper. It could be very disruptive, but it depends how Orange play it. If they get really aggressive O2 will have to respond and a full-on price war could start.” Orange has yet to disclose its contract terms for the iPhone, but has said they will be less expensive than O2’s plans.

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