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O2 ditches unlimited data tariffs

O2 to cap iPhone and smartphone internet use

Apple iPhone 4 on O2 will have data usage limits

O2 Apple iPhone 4 customers won’t get unlimited data

O2 smartphone tariffs will soon be subject to monthly caps on internet usage, in a move away from O2’s current ‘unlimited data’ smartphone offers.

The mobile internet caps will apply to all O2 customers that take out a new smartphone tariff after 24th June – the same day that O2 will start to offer the iPhone 4 – although O2 will not start to impose the limits until 1st October.

Existing customers and those that sign up before the 24th June will continue to receive unlimited data if they stay on the same tariff with the same handset. However existing customers that upgrade to a new handset or deal after 24th June will be moved onto a capped plan from 1st October. 

Internet pricing on O2’s standard mobile tariffs – currently up to £1 a day – won’t be affected by the changes. 

Find out which of the lastest smartphones on the market make it as Which? Best Buy mobiles in Which? tests. 

O2 caps data for Sim-only and pay-monthly customers

At the moment, all of O2’s iPhone, Blackberry, Palm Pre and other smartphone tariffs offer unlimited 3G data and wi-fi usage, subject to a fair usage policy which restricts ‘excessive usage’. 

O2 told Which? that UK mobile data usage is increasing at a rate of knots that is unsustainable for mobile networks, so it is changing its current ‘unlimited’ proposition to tariffs that offer a capped amount of data depending on the price you pay. 

Under O2’s new mobile data plans, smartphone tariff customers will be subject to a 500MB, 750MB or 1GB cap on 3G data usage, depending on the tariff they choose. Generally speaking, the longer the contract and the higher the monthly line rental cost, the higher the cap. The limits will apply to Sim-only tariffs as well as longer pay-monthly contracts that include a free or subsidised handset. 

Smartphones will continue to have unlimited access to public wi-fi services from O2 partners The Cloud and BT Openzone. 

How will mobile data caps affect you?

O2 has assured Which? that existing customers who have unlimited data as part of their contract will continue to receive unlimited data until they make any changes to their tariff, such as changing to a different deal or upgrading to a new handset. 

The mobile giant says that that 97% of its smartphone customers use less than 500MB of mobile data per month, so the new usage caps should only affect 3% of new or upgrading customers on O2 smartphone tariffs. 

O2 added that it’s concerned its current policy of applying a ‘fair usage’ policy to an unlimited offer is confusing for customers. It believes that introducing clear mobile data usage caps will be much more transparent and easy to understand. It plans to send regular text updates to customers to let them know how much data they’re using. 

Customers who want to use more data than their cap allows can either pay as you go or buy a data ‘bolt-on’ of £5 for 500MB or £10 for 1GB.

iPhone has caused surge in mobile internet use

Which? mobile expert Ceri Stanaway says: ‘The rising popularity of smartphones like the iPhone, which make it a breeze to access the internet on the move, has seen a boom in mobile internet use. This trend is only going to continue, and before too long the number of people that regularly use more than 500MB a month of mobile data on smartphones may include far more than 3% of  users. 

‘Its tricky to translate MB into actual internet usage, but as a rough guide O2 says 750MB would let you send 750,000 emails (without attachments). 

‘This sounds like a lot, but more data-intensive tasks such as streaming TV or regularly downloading music tracks directly from the internet to your mobile are likely to eat into your limits more heavily. O2 suggests the same 750MB cap would only cover 90 short YouTube videos a month.

‘If you’re a heavy smartphone internet user, make the most of any wi-fi hotspots and choose your tariff with care – opting for a tariff with a higher cap or buying a bolt-on is likely to work out cheaper than paying as you go.

‘If you’re heading abroad this summer – perhaps to South Africa for the World Cup – don’t forget that mobile internet use abroad can cost up to £6 per MB. So think twice before sending photos and videos back home – you could end up with a bill of hundreds or even thousands of pounds.’ 

No ‘unlimited data’ for iPhone 4 customers

The timing of the introduction of O2’s new limits on 24th June – the same day that the iPhone 4 becomes available in the UK – means that all iPhone 4 customers will automatically be subject to mobile data usage caps from 1st October. 

Rival iPhone provider Vodafone currently applies a usage cap of 1,024MB to its iPhone tariffs, while Orange claims ‘unlimited’ data but applies a fair usage limit of 750MB to both wi-fi and mobile internet browsing. 

Read the Which? review of the best mobile networks to see how O2 compares to Vodafone and Orange for customer satisfaction.

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