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Apple secures Europe iPhone revenue deals

Link: FT.com / Companies / Telecoms – Apple secures Europe iPhone revenue deals.

"Apple has succeeded in committing European mobile phone operators that want exclusively to sell its new iPhone to share parts of their revenues with the technology group.

The contract, which was signed by three European mobile operators in recent days, requires that the operators hand over to Apple 10 per cent of the revenues made from calls and data transfers by customers over iPhones.

The contract was signed by T-Mobile of Germany, Orange of France and O2 in the UK, people familiar with the situation told FT Deutschland, the Financial Times’s sister paper.

The operators are set officially to announce the partnerships at the IFA trade fair in Berlin at the end of August."

It will be interesting to see how the operators plan to make that 10% back. My horrible, horrible suspicion is that the plans they offer the iPhone with will be relatively uncompetitive, and that they’ll rely on the shine of the phone in order to gain customers.

But you get an idea of how desperate the phone companies were later in the piece:

Hamid Akhavan, chairman of Deutsche Telekom’s mobile business, is
said to have campaigned for personal talks with Steve Jobs, Apple’s
chief executive, about the contract, while Peter Erskine, chief
exeutive of O2, is said to have tried the same.

“These are not negotiations among equals. Apple clearly had the upper hand,” one industry expert told FT Deutschland.

For companies that are used to getting what they want from phone makers, that’s got to hurt. But the flip side is that the companies are, at least, likely to make some margin from the phone itself:

Apple has also lured the mobile operators with the prospect of a
financially risk-free business, as it will not allow the now common
subsidies on the sale of handsets.

So we can expect to pay the full whack for an iPhone, which would probably be around £350 for the cheaper iPhone and £399 for the more expensive model, including VAT.

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  • Ian

    Quote: It will be interesting to see how the operators plan to make that 10% back.

    Here in Germany, when signing up for a service plan with a mobile phone, the phone is subsidize which could mean costs for the operator from 200 to 500 Euros. This of course is covered under the plan. Since the iPhone will not be subsidize the “savings” that the operator has should easily cover that 10%. I personally I buy my mobile unit direct from the manufacturer (Nokia) to avoid branding and specialize firmware. Last year the Nokia Communicator 9500 had cost me 550 Euros and now I am looking at the E90 which is at the moment going for 700 to 800 Euros. Whats really interesting about the iPhone launch in the USA was that at&t created an attractive and when compared to offers here in Germany an affordable service plan for the iPhone. I am going to wait and see. The iPhone has a feature set that meets almost all of my needs and if T-Mobile introduces an affordable voice and 24/7 data plan, I’ll probably get one.

    Ian

  • J L Smith

    I feel duty bound to point out:

    http://www.t-mobile.de/tarifuebersicht_surfpakete/

    and

    http://www.t-mobile.de/tarife/0,10821,17775-_182,00.html

    Anyone think it odd that all the operators Apple has chosen are the mobile arms of the former national telco monopolies? AT&T is, well, AT&T. T-Mobile is Telekom, Orange is France Telecom, O2 is (now spun off from) BT, which is of course the Post Office.

    I wonder if that means that WLAN is as important to iPhone for Apple as GSM?

  • Ian

    JL thanks for the links. Just two things:

    none of the plans include a 24/7 unlimited data

    (real Flatrate). Thats whats great about the iPhone plan in the States. Where ever you are and whenever you want you are online and that for 20$ a month. Here in Germany I’m with o2 for voice (Genion L 25 € plus extra for calls to non 02 mobile operators)- and use Base’s (E-Plus) real data flat for 25 € with my MacBook and a UMTS Notebook card. That means two sim cards and two devices. Unfortunatly my 9500 is not UMTS capable which is why I am looking at its succesor the e90.

    Now the first link you posted is for T-Mobile’s hotspot services and the second are for its mobile data plans. Although some of the data plans include limited hotspot they just do not cut it.

    The iPhone can log into any available hotspot fee-based or otherwise and of course has at the moment EDGE access. Along with its killer screen and webbrowser – perfect. If you are looking for a way to make a whole lot of money just create a service which helps porn sites make a “made for iPhone version” of their pages. Now you can wank off anywhere at at any time for cheap! ;-)

    Like I said the iPhone feature set meets almost all of my needs. I’m hoping that the ability to use it as a modem with a notebook and that a ssh client is added in the near future which would make it perfect for me and would mean that I could leave my notebook behind 99 % of the time.

    Ian