Optus enters iPhone race

Optus has emerged as the dark horse in the race between mobile carriers for exclusive rights to launch the iPhone in Australia.

Thailand's largest mobile operator, Advanced Info Service (AIS), said it was negotiating a deal with Apple to bring the iPhone to Asia.

The telco's chief marketing officer, Sanchai Thiewprasertkul , told the Bangkok Post that AIS was collaborating with Singapore Telecom (SingTel) and Optus to launch the iPhone throughout the region.

Optus is a wholly owned subsidiary of SingTel, and SingTel owns 21.4 per cent of AIS.

"Mr Sanchai said that AIS, in collaboration with SingTel and the Australian mobile operator Optus, were discussing phone volumes, marketing terms and business model partnerships," the Bangkok Post reported.

Optus spokeswoman Melissa Clare declined to comment on the matter but said Optus continued to look at emerging technologies to deliver to customers.

The iPhone is now on sale in the US and Europe. Apple said it will launch the touch screen phone-music player hybrid in Australia this year. But that hasn't prevented many Australians from importing the device from the US and, using various hacks, unlocking it for use on local mobile networks.

Telstra CEO Sol Trujillo has said he had conversations with Apple about bringing the iPhone to Australia, and many predicted a deal would be announced early this year. Apple has refused to comment.

Telstra is the only Australian carrier with a nationwide EDGE (2.5G) network, which is the maximum speed supported by the iPhone. However, the device still works on regular 2G networks run by Telstra, Optus and Vodafone.

Apple CEO Steve Jobs said battery life issues prevented the company from releasing a 3G iPhone from the outset but it has been widely reported that Apple is building 3G support into the next revision of the device.

Nick Ingelbrecht, research director at analyst firm Gartner, said the iPhone's success in Australia would depend on its cost. In the UK, the minimum outlay for an iPhone plan is $100 a month.

Ingelbrecht also said if the first official iPhone in Australia was just the same 2G model that was launched in the US last June, consumers may view it as a bit "old hat".

"The cachet will be a little diminished by the time it is launched here," he said.

Ingelbrecht said the market was moving very quickly to adopting the 3G network as a baseline and offering a phone that only worked on the slower 2G network could affect the uptake.

At the Macworld conference in San Francisco last week, Jobs lauded the iPhone's early success so far, noting it was selling at a rate of 20,000 units a day since its US launch in June.

In the UK, the iPhone's performance was less impressive, with sales for its first two months falling 10,000 units short of exclusive carrier O2's expectations, the Financial Times reported.

This week, US telco AT&T announced it would be offering the iPhone to business customers, a surprise move as the device attracted early criticism for its lack of business-friendly features. The move by AT&T suggests the iPhone's target market is expanding, which should provide added incentive for local carriers battling to bring it to Australia.

AIS has so far refused to give further details on the negotiations with Apple or when they would be completed.

Last week, it was reported that iPhone talks between Apple and China Mobile broke down after the Chinese telco refuse to agree to Apple's strict terms stipulating partner telcos must give a significant chunk of their iPhone plan revenues to Apple.

"Given our one baht a minute of airtime, it would not make sense and would be impossible for us to share revenue with Apple," Sanchai told the Bangkok Post.