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China Mobile: iPhone talks ongoing with Apple

The on-again, off-again talks between the two companies over bringing the iPhone 3G to the world's largest cell network are apparently on again.

Tom Krazit Former Staff writer, CNET News
Tom Krazit writes about the ever-expanding world of Google, as the most prominent company on the Internet defends its search juggernaut while expanding into nearly anything it thinks possible. He has previously written about Apple, the traditional PC industry, and chip companies. E-mail Tom.
Tom Krazit

Apple is still dancing around an iPhone deal with perhaps the biggest prize remaining in the iPhone universe: China.

We've been down this road before with China Mobile and Apple, but IDG News Service managed to corner China Mobile CEO Wang Jianzhou on Tuesday, who said that "(Apple CEO) Steve Jobs and I hope the iPhone will enter China as soon as possible." Still, there's no agreement to officially get the iPhone 3G onto the largest mobile network in the world.

There are plenty of iPhones in China, but they didn't come in through the front door. Somewhere around 800,000 jail-broken and unlocked iPhones are thought to be in use in China, which has led to China Mobile's reluctance to swallow Apple's old revenue-sharing iPhone model: why should I share any revenue from iPhones on my network if you can't prevent it from being used on my competitor's network?

But the revenue-sharing model is all but dead, courtesy of carrier subsidies that have lowered the acquisition cost of the iPhone 3G. Perhaps Apple and China Mobile are haggling over the size of the subsidy, but don't be surprised if the two organizations find a way to get a deal done before the end of the year.