Here Comes the iPhone Tax For European Carriers

Financial Times recently reported that Apple has signed several deals in Europe: T-Mobile Germany, Orange France, and O2 UK.  Apparently, the mobile operators have agreed to fork over as much as 10% of the revenues resulting from the use of the iPhones on their networks.  Round one definitely goes to Apple in this boxing match.  This is a brilliant move.  Nothing is harder for mobile operators to do, than giving up a piece of their revenue per user.  Not sure this is true?   Take a read through any mobile operators' quarterly earnings slides and see how they crow about increasing average revenue per user [ARPU].

How could this be different from the AT&T rollout in the US?  Though Apple shareholders (which I am not) should be ecstatic, Apple users in Europe will need to be satisfied with cooing over the beautiful user interface with the lack of HSDPA for Internet downloading.  Jeesh, get your act together on network side, Apple.  The company certainly can’t use the excuse that Euro operators do not have the HSDPA infrastructure in place.  Heck, operator 3 in the UK, just lowered its HSDPA pricing to $20 per month for 2.8 Mbps.  I do not think we are going to see a price like that from AT&T any time soon.

Full disclosure: No position in AT&T, Apple, 3, Orange, or 02 at time of writing.

Comments

[Benoît Octave:]

Hi Paul, being in Europe with my iPhone for the last 3 weeks, I can tell you the lack of HSDPA is definitely NOT an issue, since 80% of the time I discovered Wi-Fi networks available. So why pay for less speed?
By the way, the Orange deal in France has NOT been signed yet, according to Louis-Pierre Wenes, CEO Orange France

2007 Aug 24 08:48 AM

[pavlov:]

N2 is THE phone to own.

neonode.com

NEON-NASDAQ

2007 Aug 24 12:18 PM