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O2 to hand over up to 40% of iPhone service revenues to Apple

DailyTech reported in early July that Spanish-owned O2 won exclusive rights to the Apple iPhone in the United Kingdom. There were vague details of revenue sharing bantered about among analysts at the time, but today the concrete details have come to light.

According to The Guardian, Apple will rake in as much as 40 percent of the revenues generated by O2 customers using the iPhone. This is in addition to the commission and revenue sharing imposed by O2's relationship with Carphone Warehouse. Carphone Warehouse will be the sole retailer for O2-based iPhones in the UK.

"I can't imagine any of the operators agreeing to terms like that," said one UK telecom official. "It is an extraordinary number."

It is believed that Apple receives $3 to $11 per month from AT&T for each iPhone customer in the United States.

While O2 may have the sold it soul to Steve Jobs to gain exclusivity in the UK, it is reported that T-Mobile and Orange will have iPhone-exclusive partnerships in Germany and France respectively. The T-Mobile announcement will be made on Wednesday, while the Orange announcement will be made on Thursday according to The Guardian.

One thing that is uncertain for either market is pricing for the iPhone itself. Apple made rather large waves in the North American marketplace when it priced the 8GB iPhone at $599 -- it still wasn't enough to dissuade the iPhone faithful from lining up for hours to get their hands on the device.

Apple garnered even more attention when it decided to drop the price by $200 to $399. That move sparked a revolt from early iPhone customers and eventually led to a surprisingly apologetic Steve Jobs with $100 of store credit in hand.

Updated 9.19.07: 
As expected, Germany today officially chose Deutsche Telekom to be the official German host of the iPhone, which will go on sale on November 9.  The 8GB version of the iPhone will cost German consumers $557.

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RE: What is O2 thinking?
By seamonkey79 on 9/18/2007 9:17:01 AM , Rating: 2
There's this thing about people who spend too much money on something because they can... they're almost always happy with it. Why? Because being unhappy with it would imply that they were a wee bit silly in their purchase. Either that, or their expectations are so low that they can't help but be happy with it.

But, when you get right down to it, they're not happy either. The other day I saw an iPhone user trying to do something, I didn't pay much attention to it, then suddenly he blew up, started swearing, and threw his phone on the ground and jumped on it and kicked it and just smashed the heck out of it. This was at a store with people in it, we all just stared at him, then this dude started clapping. It was funny, the guy was just standing there fuming, then he blushed and left the store.

RE: What is O2 thinking?
By Murst on 9/18/2007 9:34:00 AM , Rating: 2
Without knowing much else, I'd guess that he was unhappy with something other than his cell phone.

RE: What is O2 thinking?
By kelmon on 9/18/2007 10:38:58 AM , Rating: 2
Pictures or it never happened.

I'm sorry but I'm definitely calling this made up. No one is going to smash an iPhone when they can just sell it and at least recoup some of the money. Either that or they're just plain nuts and therefore doesn't matter either. Honestly, I could believe that someone wasn't happy and returned it but suggesting that they smashed their own phone is just unbelievable.

RE: What is O2 thinking?
By tjr508 on 9/18/2007 11:57:51 AM , Rating: 2
RE: What is O2 thinking?
By seamonkey79 on 9/19/2007 12:08:06 PM , Rating: 2
Pictures or it never happened.

You obviously don't know humans. When a person gets mad, particularly at an inanimate object, they are definitely capable of breaking it. I'm sorry you think I'm making things up, but that's your right as a human :-)

I respect people's privacy, and as such, while my phone does in fact have a camera on it, and is capable of taking videos, I don't do such, because it irritates the heck out of me that people are likely doing such to me, and I hate it, so I don't do it to them, because they might hate it. Who knows, this guy could be husband to someone who's reading this, and they might have gone out and bought another iPhone, so then their spouse would know that not only did they spend (probably) $600 on the phone in the first place, but then broke it in a fit of anger, and then another $400 to replace it. So no, no pictures.

"People Don't Respect Confidentiality in This Industry" -- Sony Computer Entertainment of America President and CEO Jack Tretton

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