The cost of contract smartphones may rise in the UK if a price war erupts between operators over the iPhone. Orange announced on September 28 and Vodafone on September 29 that they have successfully forged an alliance with Apple to launch the iPhone on their respective networks in the UK. T-mobile and 3 may be announcing something shortly too.
In an attempt to lure customers to the data-happy iPhone, mobiel operators will have to increase subsidies on the iPhone. Meanwhile, the cost of other handsets will have to rise as a result. Operators could shift subsidies from other vendors, such as RIM, HTC and Samsung, thus increasing their handset prices.
Orange will be selling the iPhone before Christmas, while Vodafone will only be able to launch it early 2010.
O2 has been bit hard by Apple’s decision to remove its exclusive rights on the iPhone after two years. It is thought the network may now look at alternative devices, such as the Palm Pre or Motorola’s android based range of phones to boost revenues.

The cost of contract smartphones may rise in the UK if a price war erupts between operators over the iPhone.

Orange announced on September 28 and Vodafone on September 29 that they have successfully forged an alliance with Apple to launch the iPhone on their respective networks in the UK. T-mobile and 3 may be announcing something shortly too.

In an attempt to lure customers to the data-happy iPhone, mobile operators will have to increase subsidies on the iPhone. Meanwhile, the cost of other handsets will have to rise as a result. Operators could shift subsidies from other vendors, such as RIM, HTC and Samsung, thus increasing their handset prices.

Orange will be selling the iPhone before Christmas, while Vodafone will only be able to launch it early 2010.

O2 has been bit hard by Apple’s decision to remove its exclusivity after two years. It is thought the network may now look at alternative devices,  such as the Palm Pre or Motorola’s android based range of phones to boost revenues.

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www.WirelessFederation.com/news: Choi See-joong, the Chairman of South Korean regulator, has reportedly asked mobile operators to lower call charges on the back of an OECD report highlighting the country as one of the world’s most expensive for mobile phone use .

As per his recommendations, a similar pledge by South Korean President Lee Myung-bak to cut mobile rates by 20%. The regulator is considering a variety of methods to force rate reductions, including the banning of handset subsidies to promote cheaper call rates, expanding pre-paid tariffs and most notably allowing the introduction of mobile virtual network operators (MVNOs). However, all three telcos are not in favour of this. SK Telecom has claimed that government interference could have a negative effect on competitiveness in the wireless sector.

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Following T-Mobile’s recent announcement, market leader KPN has also decided to cut the commissions it pays to retailers for selling mobile services in The Netherlands. From September, KPN will gradually reduce handset subsidies and sales commissions. The handset subsidies and excessive sales commissions have been a thorn in the side of operators in recent years amid an increasingly saturated Dutch mobile market. The handset subsidies and sales commission contribute to very high churn rates, reaching 30 percent, but do not add to service revenue growth, putting pressure on profit margins. A reduction was inevitable, but the question was which operator dared to take the first step and risk giving the competition an advantage? The first move by T-Mobile and the recent success of E-Plus in Germany may have helped KPN take the decision to pull the plug on handset subsidies in The Netherlands.

Source- http://www.telecompaper.com