iPhone deal "negative" for operators

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iPhone deal "negative" for operators

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By Editorial Team (Tuesday, 28th August 2007)

The recent agreement made between Apple and Orange, T-Mobile and O2 over the sharing of iPhone revenues is threatening to "rewrite the rules" of the mobile phone industry, it has been claimed.

With network providers pledging to give Apple 10 per cent of revenue from calls and data transfers made by iPhone customers when the product is launched in Europe, a "dramatic power shift" could occur in the mobile sector, the Independent reports.

According to the newspaper, the value of operators' brands could be seriously affected by the new development, which may see handset manufacturers emerge as the dominant market force and network providers become mere "utilities providers" to these brands.

Richard Windsor, an analyst at financial services group Nomura, commented: "I view it as a big industry shift and a negative one for operators.

"It shows how powerful the manufacturers' brands are becoming compared to the operators'."

O2 will be the exclusive seller of the iPhone in the UK, while T-Mobile will market the product in Germany and Orange will launch the handset on the French market. The iPhone was introduced in the US in May and is expected to reach UK shores before Christmas.