O2 Set To Lose Exclusivity On iPhone 3G

The agreement that ties Apple and O2, the Telefonica owned mobile network, is set to be broken on October 9th according to a website whose journalist that claims to have seen "official documentation" about this subject.

In an article written by Tim Green, he writes that the papers presented to Mobile Entertainment state that the partnership will end exactly in exactly 65 days, on Friday the 9th of October. The deal was set to last until 2012, a multi year agreement that started in 2007.

But the exclusivity arrangement would last only two years although it is understood that O2 will retain the rights to the iPhone 3GS and possibly other future iPhones while the other networks will have to make do with older versions.

Orange, Vodafone, T-Mobile and Three could well start selling the iPhone by the end of the year although Orange and T-Mobile, because of their existing relationship with Apple in Europe, could have a head start.

O2 has already started canvassing other smartphone manufacturers to make up for any potential exodus of customers when it loses the iPhone. It has already said that the Palm Pre will be available before the end of the year.

Is it going to bring down the cost of acquisition of the iPhone? Certainly not. iPhone prices, at least the price that networks will be paying for them, won't decrease at all we reckon. Instead networks will have to make an extra effort to attract users by slashing prices.

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Our Comments

We've already written on rumours that O2 would be losing the iPhone exclusivity and why the Palm Pre, although it is a very desirable handset, wouldn't be able to replace the iPhone while Orange could have shared distribution with O2 soon-ish.

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