Apple 2.0

Covering the business that Steve Jobs built

iPhones in Switzerland, Spain, Poland and beyond

May 8, 2008: 7:45 AM ET

News and rumors about the iPhone's global expansion keep rolling in.

Citing a source at Swisscom, Lausanne-based Le Matin Online reported on Thursday that Apple had concluded an agreement to bring the 3G iPhone to Switzerland this summer (link, in French). Swisscom, with 5.1 million subscribers, is the country's largest mobile carrier.

Meanwhile, France Telecom CFO Gervais Pellissier said on Wednesday that his company was in talks with Apple (AAPL) to extend their partnership beyond France and into "more than just two countries." He was responding to a journalist's question about whether the company was hoping to secure rights to sell the iPhone in Spain and Poland, the largest countries in Europe still without an iPhone carrier. (link)

Also on Wednesday, America Movil (AMX) confirmed that it had signed a deal to bring the iPhone to 16 countries in Latin America and the Caribbean. America Movil, based in Mexico City and controlled by billionaire Carlos Slim, has 159.2 million subscribers. (see here)

Earlier this week, Vodafone (VOD) announced that it had signed an agreement to carry the iPhone in 10 countries, Australia, the Czech Republic, Egypt, Greece, Italy, India, Portugal, New Zealand, South Africa and Turkey. The same day, Telecom Italia announced that it had also secured the rights to sell the phone in Italy, leading to speculation that Apple had abandoned its original iPhone business model and was no longer demanding revenue sharing in return for exclusivity. (see here)

But France Telecom's Pellissier said that his company was sticking to the terms of its original agreement, which gives it the exclusive right to sell the iPhone in France for another two and a half years. France Telecom is resisting pressure to lower the price of the original iPhone -- as O2 and T-Mobile did in the U.K. and Germany, respectively -- at least until the 3G iPhone arrives. "We'll see with the next model," said Pellissier, according to Macworld, adding that the arrival of a new iPhone "will boost sales." Pellissier declined to give exact sales figures, but said his company had sold more than 100,000 since November, 2007.

According to Piper Jaffray analyst Gene Munster, exclusivity agreements may soon be the exception, not the rule. He notes that the Vodafone announcement, unlike press releases issued by the first wave of carriers, "did not reference any exclusive terms." He expects Apple will start to feel the impact of the loss of revenue sharing from these nonexclusive deals in 2009, but still views them as a net positive for the company.

"While we expected an international rollout in CY08 (with the exception of China), this announcement is both sooner and more expansive that we were expecting. ... The iPhone's international rollout is about 6 months ahead of our original expectations."

On Tuesday, April 29, Rogers Wireless, Canada's largest cellular carrier, announced that it too had signed a deal to carry the iPhone "later this year." (link)

Meanwhile, stocks of first-generation iPhones are running low. Spot shortages continue in the U.S., and Engadget reports that O2 on Thursday posted a notice on its website that iPhones -- both the 8G and 16G models -- are no longer available in its stores. The 8G model was on sale in the U.K., but the 16G model sold at full price until the shelves ran dry.

[Thanks to reader David C. in Switzerland for the tip.]

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About This Author
Philip Elmer-Dewitt
Philip Elmer-DeWitt
Editor, Apple 2.0, Fortune

Philip Elmer-DeWitt has been following Apple since 1982, first for Time Magazine, and now on the Web for Fortune.com.

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