Confirmed: Apple To Launch iPhone In UK With O2 In November

No surprises here…Apple (NSDQ: AAPL) has chosen O2 (TEF.MC) to be its mobile operator for the UK launch of its iPhone and will use the retail chain Carphone Warehouse as an additional point of sale. Before you skim the article looking for specifics on revenue share, either on device sales or services: Apple, O2 and Carphone Warehouse have (also unsurprisingly) kept mum on this point. Some of the more salient details:

Sales specifics: The device will go on sale on November 9 for 269 pounds ($536) and will be sold through Apple, O2 and Carphone Warehouse (all three will sell it online and in retail shops: these will total about 1,300 locations). The price compares unfavorably with the price point set in the U.S., especially in light of recent discounting to $399. In defense of this, Steve Jobs, who spoke at the London press conference this morning announcing the deal, says that the U.S. price doesn’t include sales tax (the UK price includes VAT of 17.9 percent), “and then there’s a little bit more because it’s a little more expensive to do business here. We try to be as aggressive as we can.” Unlike most other devices for sale on the UK market, the iPhone price will not be subsidised by O2. (And if reports of the super-high revenue share of 40 percent given to Apple on all service revenues are true, it’s no wonder…)

Subscription packages. Three different contracts of 35 pounds, 45 pounds and 55 pounds ($70, $90, $109), all including unlimited data and varying amounts of voice minutes. (Again, these rates are higher than the $60, $80 and $100 prices with AT&T (NYSE: T).) No mention of pay-as-you-go tariffs — although given that upwards of some 75 percent of mobile phone users in the UK are not on contracts, this seems to be blocking out a big portion of would-be buyers. (Perhaps they can go for the illicit unlocked variety.)

Network coverage. As previously reported, O2 will be upgrading its GPRS network to EDGE (NYSE: GE), which is what the iPhone uses in the U.S. market. Matthew Key, the CEO of O2 in the UK, said that the network will have 30 percent EDGE coverage by launch, “and we’ll build it from there”. O2 only has about 30 percent coverage nationwide for its 3G network. In what could be more of an excuse than a real reason for choosing EDGE, Jobs claimed that the reason Apple hasn’t built in 3G chipsets, and insisted on 3G network, is because the battery life for 3G still isn’t up to scratch, calling 3G phones “power hogs”. “We’ve got to see the battery lives for 3G get back up into the 5-plus hour range,” he said. All data plans will also include public WiFi usage via 7,500 hotspots operated by The Cloud. Key said that O2 thinks two out of every three uses of the Internet on the iPhone will be via WiFi — a damning admission perhaps if O2 is in any way concerned about what impact the iPod Touch (the WiFi-enabled one that just came out) might have on its iPhone sales.

Services. There is a quick-link button to iTunes, but Apple has not yet launched a mobile version of the UK iTunes store to use on the phone. Jobs says this will come with a software update (no date specified). On other services: “We’re already starting to see a lot of good applications. Some people are wanting to add apps that don’t need an Internet connection to run. We’re looking at that.”

release | link to Guardian blog (informal transcript of event)

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