O2's decision to drop £100 from the price of the iPhone is surprising. Not because we didn't see it coming… we did. But because it's rare in general to find Apple products discounted.
This is all part of Apple's clever marketing plan. You don't knock down the price of products because it screams to the world that you're trying to offload unsold units. In this case it is because everybody and his dog knows that a new iPhone (hopefully with 3G) is coming out in June.
However, some of the UK press have reported this as being due to "slow sales".
We assume that O2 had a meeting with Apple and said: "when's the 3G model out?" and Apple said: "June" and O2 did what normal companies do and hacked the price of the phone to offload the unsold units.
Apple itself hasn't done this on the store. In fact, Apple would never do this. When was the last time you saw Apple drop £100 off a computer because a new one was planned?
For example: we know that a new model of iMac is incoming. Not because Apple has told us you understand; but because it's updated its MacBooks and MacBook Pros and Mac Pros and so next will come a new iMac.
Apple traditionally launches new products on a Tuesday and we've been watching the Apple store like a hawk for the last few Tuesdays, waiting for it to go down for a couple of hours to herald the arrival of a new iMac.
Maybe it'll be next Tuesday; maybe the one after, but we know it's coming.
And do we see £100 knocked off of the current iMac model? No: Apple will continue to sell the iMac at full rate until the new model is ready; then it will introduce the new model.
I assume that Apple slowly ramps down production and times the release of the new unit to coincide with a stock shortage. Any left over models are sold off as clearance 'after' the new model is announced.
In some ways it's a refreshing change to see Apple products being treated like any other. You'd have to be a mug to buy an iPhone this close to an update though.
On the other hand I don't like seeing adverts for iPhone's plastered everywhere with "£100-off while stocks last". Not because I don't think the iPhone should cost £100 less. We all know it's too expensive. But O2 running adverts everywhere with £100 off the price in the run up to a new unit's arrival looks cheap.