O2 has beaten its rivals to win the exclusive UK rights to offer Apple’s iPhone. The tie-up, the mobile phone industry’s most sought-after deal in years, marks a major coup for the 18 million-customer group. The final contract is expected to be signed imminently. The phone, which should be on sale in time for Christmas, is expected to prove a key weapon in enabling O2 to win and retain customers in one of Europe’s fiercest mobile markets. It is understood that negotiations are continuing with mobile phone retailers including Carphone Warehouse over an agreement to sell the iPhone in their stores after a period of exclusivity with O2.
Shares of O2 ’s owner, Telefónica, of Spain, are expected to surge today on the back of the news. The deal will come as a bitter disappointment to Vodafone, which had been tipped as the front-runner for the deal. Arun Sarin, Vodafone’s chief executive, had been pushing hard to secure a deal for the iPhone, which has been at the centre of one of the most fiercely contested mobile battles since the £22.5 billion auction of 3G rights.
In the UK customers signing up for an iPhone are likely to face hefty fees to buy themselves out of their existing contract and move on to O2’s network. The phone is expected to retail at about £300 in a market where phones are traditionally given away. Rival handset manufacturers are busy preparing “iPhone killers” for Vodafone and the other losing operators. O2 and Vodafone both declined to comment.
Source: Times Online