US iPhone debut sparks UK launch debate

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Anyone in the queue for an iPhone in the US today will also be signing up for a two-year plan with mobile provider AT&T. However, it's not yet been announced which UK or European operator - if any - will be the benefactor when Apple's gadget crosses the Atlantic in October.

As IT PRO reported earlier this week, Vodafone is at the forefront of rumours about which network will partner with Apple in Europe, none of which have been substantiated.

The benefits of any such tie-up have been questioned by analysts.

"I think that from Apple's side, Vodafone makes a great deal of sense as it has the biggest footprint in Europe," said Carolina Milanesi, an analyst at Gartner. "I'm not sure if it fits with Vodafone, however."

Vodafone has been trying to take power away from manufacturers, quite the opposite of what would happen in a partnership with Apple, she said.

"There's lots of power with Apple," Milanesi said. "But I'm not sure Vodafone will take whatever conditions Apple gives it."

More importantly, embracing content downloads from iTunes would be a departure from their current strategy of focusing on mobile downloads via Vodafone Live content.

While it is possible to download music or video over the iPhone's browser, users must have an account with iTunes - which means downloads will largely remain computer-based. Either way, it'd be difficult to fill 8GB of space by downloading via mobile channels.

"In terms of content strategy, for Vodafone, it doesn't make much sense, as it's bypassing its own services for downloading over air," said Ovum analyst Steven Hartley.

Any of the other major European providers could also be contenders. O2 and T-Mobile have strong music ties, but Orange or 3 are also possibilities as all have sizable European footprints. They all face similar technology and business strategy challenges as Vodafone.

"One of the key aspects of the iPhone is the emotion, the aspiration. That overrides the technical side," said Hartley. "In Europe, any of the big guys would like a piece of the hype. Really, it's going to be a marketing decision."

"In the short term, it's a great boost. Everyone loves the hype. In the long term, in terms of core functions, they could lose data revenue as music and video will not be over-air, but through a browser... you're competing with yourself," Hartley added.

He noted that as this is only the first version of the phone, later versions may include better over-air download provisions.

Due to the differences between the North American and European markets, Apple could end up going with a smaller firm or even selling the device through its own stores, without a mobile operator partner. "We may be making the wrong assumption that this is going to go the same as the US," Milanesi said. "The European market offers more possibilities than the North American market."

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