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Apple's Demands of Vodafone reports that the reason Vodafone decided not to partner with Apple for the UK iPhone launch is due to Apple's demands.

Apple is understood to be demanding that its European mobile phone partners hand over a significant proportion of revenues generated by the iPhone and restrict the content that users can access.

O2 is rumored to have won the deal, though no contract has been signed yet.

Apples unconventional contract terms also led to Verizon's rejection of the iPhone deal. Apple ended up partnering with AT&T and reportedly has some form of revenue sharing for monthly iPhone contracts.