Apple, O2 to slash 8GB iPhone price in the UK - report

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Apple and wireless partner O2 this week will slash the price of its iPhone handset in the UK to 169 pounds from 269 pounds as part of a limited promotion, according to a new report.

The move will see the localized version of the 8GB iPhone sell for just $333, or considerably less than the current US$399 fetching price within the United States, according to Mobile Today.

The overseas trade publication, which did not name sources, said an announcement is expected Wednesday and that the 16GB model would not see a similar reduction, remaining at £329.

Apple recently instated a similar price cut in conjunction with T-Mobile Germany that saw the local version of the 8GB iPhone fall from €399 to €99.

As was the case following the reductions in Germany, speculation is that the UK promotion is the latest precursor to a new model that will operate on third-generation (3G) wireless networks.

In a report issued earlier this month, Piper Jaffray analyst Gene Munster said steep price cuts on the touch-screen handset are a sign Apple is looking to drain existing inventories ahead of 3G iPhone launch no later than June.

The analyst noted that the electronics maker has been able to maintain tight control of iPhone inventory at its own stores, which have been running extremely lean of stock in recent weeks.

"This type of channel control is typical of Apple ahead of new products," Munster wrote. "In Europe, the opposite story seems to point to the same conclusion. Apple's carrier partners are a completely separate channel from its own retail stores, and the carrier partners appear to be overstocked with iPhones."

"Therefore," he added, "it seems as if this has led to Apple trickling iPhones into its U.S. retails stores, while T-Mobile and other carrier partners seek to drain their stock of iPhones ahead of a new model."


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