Apple iPhone: Has 3 won it for Australia?

Apple iPhone: Has 3 won it for Australia?

Summary: AT&T won the right to offer the hype-worn iPhone in the US and it looks like Spanish-owned operator O2 will get the same chance in the UK -- now the bets are on for which of the operators will bring the Apple handset to Aussie customers.While there is no confirmed date for when the iPhone will launch in Australia -- save for a vague "early next year" -- as expected, neither Apple or the operators themselves are giving anything away.


AT&T won the right to offer the hype-worn iPhone in the US and it looks like Spanish-owned operator O2 will get the same chance in the UK -- now the bets are on for which of the operators will bring the Apple handset to Aussie customers.

While there is no confirmed date for when the iPhone will launch in Australia -- save for a vague "early next year" -- as expected, neither Apple or the operators themselves are giving anything away. However, with potentially nine months or so til launch date, negotiations are likely to have started between the Mac maker and its suitors, if not concluded.

So who is in the frame? Telstra is potentially the most obvious frontrunner, having the user base, clout and crucially the technology to be the apple of Apple's eye.

[? template('/'.constant('CMS_VHOST').'/common/poll/display_poll.htm', 1620726876) ?]

However, Telstra has previously been dismissive of the device, with the telco's CTO Greg Winn recently telling AAP: "There's an old saying -- stick to your knitting -- and Apple is not a mobile phone manufacturer, that's not their knitting. You can pretty much be assured that Nokia, Motorola, Samsung, Sony Ericsson and ZTE and others will be coming out with devices that have similar functionality."

Robin Simpson, research director, mobile and wireless at Gartner, however, suggests that such a stance may be revised in light of the iPhone's opening weekend. "Greg Winn might have said that before he saw the device and saw how it worked. Most mobile operators would consider 500,000 units a success, which would mean the iPhone is a success in its first weekend."

Another potential sticking point for a Telstra-Apple pairing is the Mac maker's desire to have more control over the retail process than most handset manufacturers do. The two traditionally hard-headed companies might find themselves clashing, with Telstra unwilling to bend to Apple's requests -- it's thought negotiations with Vodafone in the UK broke down for the same reason.

One of the reasons Telstra is thought to be a frontrunner is the question of standards. In its current iteration, the iPhone has no 3G connectivity and is instead compatible with EDGE networks -- and Telstra is currently the only Australian mobile operator to use the technology in question.

The EDGE question is likely to have a short shelf life though -- it's unlikely Apple will launch an iPhone in Europe without 3G. Unlike the US, in Europe's most lucrative and populous markets, 3G is the norm and operators have spent billions on their networks that they're now keen to recoup.

For another hint that a 3G iPhone is on the way, take a look at the UK, soon to get its own iPhone launch. There, only operator Orange has an EDGE network running and so far, its name has not been linked with the iPhone -- unlike EDGE-less rival Vodafone, initially in the frame, and current favourite O2. The former has an EDGE sharing deal with Orange, the latter, perhaps tellingly, does not.

With a 3G iPhone on the market, the choice of operators opens up -- and becomes infinitely more interesting. Gartner's Simpson said despite being a relatively little fish, Hutchison owned 3 could yet prove attractive to Apple by being more open to negotiation than Telstra: "3 is number four in the market but as a smaller player, it means you might be willing to bend a little more," he told ZDNet Australia.

Equally, having seen 500,000 people switch to AT&T to get their hands on an iPhone, the promise of a large block of new subscribers could be a tempting prize for smaller 3.

Jerson Yau, analyst at IDC, said: "Apple and 3 are very much in line. It would give [3] a tremendous boost."

Of the four main operators who vied to carry the iPhone in the UK, the likely winner O2 is the one making the greatest progress in encouraging customers to spend on non-SMS data. Could this be an indication of which way the coin will fall in Oz?

Vodafone has already spent a lot of time and effort on its Vodafone Live! portal, making money by selling both content and data: devices that promote themselves on open Web browsing cut out the content revenues and just leave the data earnings. The iPhone would turn Vodafone into a bit pipe rather than a content vendor, something that may not please the operator.

One operator who has embraced the bit pipe model is 3, with the X-Series -- a recent initiative launched by the operator which offers a slew of Web services, such as Skype and Windows Live Messenger, over 3 phones for a fixed data fee.

The X-Series has been a significant sea-change for 3. For several years, the operator offered a walled-garden approach, only allowing users access to certain optimised sites.

For IDC's Yau, 3's revamped business model could fit well with Apple's view of the mobile market. "It would be a massive win for an operator. The X-Series and Apple could be a very potent combination -- the other carriers would have to respond strongly," he said.

Topics: Apple, iPhone, Mobility, Telcos, Telstra

Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.


Log in or register to join the discussion
  • anonymous

    3 doesnt even have a EDGE in au, it resold someone else's under its old orange brand

    no apple iphone for au unless it gets 3g
  • goose phone

    who cares. It's just a jewellery for apple geeks. They'll buy anything with the apple logo on it, even lemons. Like the Apple computer...oh no but wait, 8% of the market can't be wrong...
  • If you don't care

    then don't buy one. Free country, no-one forcing you to buy.

    Having said that, I have managed to switch a few people from Windows to Mac - people actually say how much easier the Mac is to use.

    Market share doesn't mean its better; lack of market share doesn't mean its worse.
  • Please not Telstra

    Greg Winn's comments are typical of an organisation full of itself. Pity they have a good network...

    Why did Crazy John do so well? Because people DIDN"T want to deal with Telstra, but they did want to access Telstra's network.

    In the end, they shafted him so badly, he has jumped ship to be a MVNO with Vodafone. Wish you well.

    Now, I would love thethered modem function on iPhone; I can't get it to work on my Blackberry Pearl on Vodafone.
  • Commenters

    Nothing but a bunch of crybabies and ego flaunters.
  • iPhone

    Great article, well done.
  • I am buying one regardless

    I am the target market. I am in my thirties, have the money to pay - I don't want to carry two devices around - and I want an iPod.

    I am not alone, and my younger brethren in their twenties are even more enthusiastic.

    The Liberals are out and the iPhone is in next year in Australia. Expect 500,000 units - at least - in Australia. Stand back Telstra, and adios Amigo to Telstra for yet another blunder to send the stock tipping - who owns Telstra anyway ?
  • Don't worry about no 3G coverage

    As you may be aware the next big Apple show will be in January next year. This has to be the platform to launch the iPhone 2. It will have 3G coverage and we will get here in Aus.

    I must admit the whole thing of buying a handset then being stitched up by a phone company for 24 months harks back to the days of when phone calls were $1.40 per minute.

    In saying all of that I don't understand the hesitation of one of the phone companies from signing up with apple and using the hype to pre-register interested people to their respective phone service.

    Say it's "3" you would have at least 6 months worth pre launch campaigning to use before getting the phone onto the market. Imagine the advertising blitz that would happen in the next few months since "3" is the main sponsor for the cricket.

    Whatever the outcome the provider better make sure they have enough of the iPhone's in stock to cater for the demand.
  • please not telstra

    i was with telstra once and they fully ripped me off and sh** reception.

    3 changed my life around and the iphone should be with 3.

    Telstra it might be australian but its a shit company, 3 is way better with the Caps, and Deals they have! I telling you from a public eye in australia you'd be stupid to join TELSTRA, plus most Australian these days are joined with 3, Vodafone, Optus!!!! Because of the free calls, sms!!!! Even thought everyone going to buy this phone when it comes to AUS! I'd vote for 3!!!!
  • As if it couldn't be Telstra

    As much as the big T are pains, the NextG network is really the only one you want to be on down here in Tasmania; Vodafone were a better company to deal with but that's of little use if the phone doesn't work. Apple went with AT&T not because they were the best, but because they had the most coverage... generally doesn't pay to limit your potential market.

    Telstra needs a 3G/NextG iPhone more than anything... a fact they've probably just realised, given their recent backpedalling on the iPhone. At the moment NextG is going completely to waste... full of daft, expensive services like video calling and streaming Foxtel that few people could care about, let alone be willing to pay for. Along comes a phone that makes checking your email and surfing the web on the move as normal as doing it on your home computer, AND everyone wants it! $8 a month for 3MB of data? Forget it - people will want unlimited data plans and be willing to pay $50-$100 for it. Telstra aren't blessed with the best vision, but I'm sure they can see this.
  • reply

    go for it dude
  • Any of the above - except Telstra

    A 3G model please and any of the above - except Telstra, and I'd rather own the phone outright than have it tied to any one provider
  • Unlocked is better

    Why tie the iPhone to a single carrier? Sell them in the Apple stores, and let customers BYO SIM. Plenty of very good phones are already sold that way.

    Also, NextG is on a different frequency to the other 3G networks in Australia. It could be that the AU model of iPhone is hardware that works only on the European 3G bands - so maybe nextG isn't even in the running?
  • Not Telstra

    I can't see Apple and Telstra getting in bed together - they are so deeply in competition with each other now. Why would telstra want to support iTunes, movies, etc. Also Telstra has long been a MS strategic partner. No- Telstra does not make sence if there are reasonable other options for Apple in Australia - either Vodafone or 3 seem much more likely.
  • 3 only carrys 3G handsets.

    this handset is not 3g therefore...
  • Didnt u read the story

    This story is telling you that the Iphone will have to go to 3g if its going to be released in Australia.
    and that more than likely it will, in fact it definitely will because without 3g coverage then there'd be no Iphone in Europe or Australia.
    I also think 3 should win they may be small but there the best F***ing service I know of.
    GO 3!!!
  • wont fly

    not only does 3not have an edge but the iphone isn't compatible with the 3 network...
    its more likely that vodafone will pick it up seeing telstra has been quoted bagging the phone, saying that apple are computers and the like, not phones and that they should stick to what they know.
  • i want UNLOCKED iPhones

    i agree... but i want to UNLOCK any networks but not to Telstra 'coz it's ugly network, you'll get your bills higher... same with 3... i don't like expensive bills... so i always notice that it should be NO CONTRACT so that it can be used in prepaid and no-contract... i wanna use it with unlocking and using with different networks like 3, Vodafone, Optus and some International simcards =)
  • Telstra has it covered

    No-one seems to be talking coverage here, and yet for my money that's why Apple went with AT&T--despite the lower-speed EDGE network. Apple's most important proposition is to make technology simple, for the masses, and with very few decisions required. Hence, I'm convinced that they won't be talking to 3 because of the small coverage area and complicated roaming arrangements. They'll want coverage as Australia-wide as possible, with very simple billing plans. So 3 might fit Apple, but it's not true vice-versa.

    As has been pointed out earlier, Telstra has an unswerving history of having its collective head up Microsoft's backside, and they clearly aren't the kind of company to accede the required level of control to Apple (or anyone else). That's why Greg Winn talked down the iPhone at his earliest convenience. A final nail is their 850MHz spectrum: I'm also not confident that an early Oz version of iPhone would support it.

    So that leaves Optus and Vodafone. And I wouldn't be at all surprised if Optus surprised us ... they're so hell bent on trumping Telstra with anything they can that they might just be interested enough. And at least they haven't been Apple-phobic in the past.