Regional users: Don't bother with the iPhone

The new iPhone won't offer 3G speeds outside of the major cities.

Residents of regional Australia looking to buy the new iPhone for its 3G connectivity might want to reconsider, according to Ovum analyst Nathan Burley.

While metropolitan iPhone users will enjoy full 3G speeds via Optus and Vodafone's 2100 MHz 3G network, the 900 MHz band the two carriers use to connect 3G users in regional Australia is not compatible with the iPhone. The phone will instead drop back to the significantly slower 2G/GPRS speeds.

Burley said that this means the 3G iPhone, which works in 3G mode on the 2100, 1900 and 850 MHz frequencies, doesn't offer any marked advances in speeds for regional users in Australia.

James Casey, chief marketing officer for Vodafone, disagrees. He said that both Optus and Vodafone are building out their 2100 MHz networks to address the issue.

"The 900 MHz band only applies to the very fringes of our network," he said. "Both Vodafone and Optus are building out our 2100 MHz 3G networks all the way to those fringe areas. It would only be a small proportion of the population that would still be relying on [2.5G] EDGE."

Casey said Vodafone is on track to extend its 3G network to cover 95 per cent of Australia's population by the end of the year.

Burley notes that Telstra's Next G network does use the 850 MHz band supported by the iPhone.

"If Telstra offered the iPhone, it would offer 3G all over the country," he said. "In that sense, Telstra has an advantage."

Telstra has made no mention of any plan to offer the iPhone, but regional users may have the option of unlocking the 3G phone to use on Next G should such a fix be made available.

"As we saw with the first generation iPhone, people will find a way to unlock the device and use it on any network," says Burley. "I'm sure that will happen with the iPhone 3G."

Apple declined to comment.