Apple to Partner with O2 in UK, Orange in France, No 3G? - MacRumors
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Apple to Partner with O2 in UK, Orange in France, No 3G?

TimesOnline.co.uk reports that O2 has won rights for exclusive UK rights to the iPhone.

O2 has beaten its rivals to win the exclusive UK rights to offer Apples iPhone. The tie-up, the mobile phone industrys most sought-after deal in years, marks a major coup for the 18 million-customer group. The final contract is expected to be signed imminently.
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The deal will come as a bitter disappointment to Vodafone, which had been tipped as the front-runner for the deal.

Vodafone is reported to have been "pushing hard" to win the iPhone contract but in the end felt that the commercial terms were not viable.

Timesonline.co.uk also suggests that Orange is the front-runner in France.

Finally, FTD.de reports that iPhone will start in only these three countries this Fall: UK, France, and Germany. According to the publication, the European version of iPhone will not support 3G, despite some earlier rumors.

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