Tech Industry

U.K. businesses see barriers to iPhone adoption

Cost and network-operator restrictions are preventing chief information officers from considering the iPhone as a corporate device.

Bosses in the U.K. are not planning to make the iPhone available to employees as a corporate mobile option because of the phone's high price tag and network-operator restrictions.

Apple last week revealed details of the U.K. version of the iPhone, which will be available beginning November 9.

, Apple Chief Executive Steve Jobs named O2 as the exclusive mobile operator for the iPhone, which will cost $543 in addition to a monthly contract ranging from $70 to $110.

Despite the cost, a poll of more than 700 readers by found that a third would switch to another mobile operator just to get their hands on an iPhone. The U.S. version, which operates on the AT&T wireless network, has already sold more than a million handsets in the first 74 days since it launched.

However, when asked the 12 members of a CIO Jury IT director panel whether they have plans to make the iPhone available to employees in the range of corporate phones they offer, only one said he would.

Ian Campbell, British Energy chief information officer, said his organization is planning to make the iPhone available to some staff. "It's likely to be at the executive end rather than general-purpose. A killer application or use would drive up demand," he said.

Tying the iPhone exclusively to O2 is one of the biggest barriers to corporate adoption, said Peter Birley, IT director at law firm Browne Jacobson. "Regardless of any functional benefit there may be," Birley said, "the restriction of one network provider would exclude it for us."

David Supple, director of IT and creative services at Ecotec, raised additional concerns. "Aside from the phone being limited to only one network, I can't see how this is a serious business tool, and I would have some concerns over staff being targeted for theft of what is a very desirable object," he said.

Michael Elliot, IT director at toy maker Hasbro UK, said the iPhone will be on a "watching brief" only for now. "We have an existing bulk contract currently with Vodafone and no plans to allow folks to stray from it in the near term. I expect to get pressure but early-adopter experience may not be all positive," he said.

The iPhone's price tag and lack of integration with Microsoft Exchange are the other issues for corporate IT departments.

"It's far too pricey. In a few months' time it may be a useable tool, but we'll have to see whether Microsoft Exchange integration is at all possible," said Nicholas Bellenberg, IT director at publisher Hachette Filipacchi UK.

If the response of the chief information officers is anything to go by, Research In Motion's BlackBerry shouldn't be under threat as a business communication tool.

"We use BlackBerrys and then lightweight laptops with 3G cards and VPN software for general connectivity," said Kevin Fitzpatrick, chief information officer at Sodexho UK. "Particular applications also have specific handheld devices. The iPhone would be seen as expensive and trendy rather than a corporate tool in our industry."

Asked whether he planned to allow the iPhone as a corporate phone, Andy Pepper, director of business IT at tea supplier The Tetley Group, simply said: "Not at that price."

Andy McCue of reported from London.