Opinion: iPhone UK launch will be £250, O2 exclusive, but not 3G

After nearly three frustrating months of waiting, Apple is finally set to launch iPhone in the UK tomorrow, revealing the handset’s price on this side of the Atlantic, as well as which mobile operator has bagged the exclusive rights.

Kat’s summarised the latest rumours about Apple’s press launch tomorrow in London, for which invites have been sent out with the tagline ‘Mum is no longer the word’.

Obviously, we’ll be covering the launch tomorrow morning, but before we get some hard facts, there’s one last chance for some wild speculation about who that operator is, how hard Steve Jobs has crunched their balls in a vice, how much the iPhone will cost here, and whether it’ll be 3G.

Let’s start with the operator. It seems pretty clear that O2 has bagged the exclusive rights to sell iPhone in the UK, although elsewhere in Europe T-Mobile (Germany) and Orange (Spain) appear to have got in on the act.

Today’s Guardian has a well-sourced report claiming that O2 has agreed to pay Apple a shocking 40% of voice and data revenues from iPhone customers – a deal that’s unheard of in the mobile industry. Apparently all the UK operators were in the hunt at one time or another, but couldn’t compete with O2’s offer.

Just today, the O2 rumour has been augmented by reports that Carphone Warehouse is in on the deal, as the exclusive ‘independent’ retailer (although that doesn’t mean unlocked iPhones sadly – they’ll still be on O2).

What about the specs then? In a just world, the iPhone would have acquired 3G functionality by the time it made it to this side of the Atlantic. But there’ve been numerous reports in the last few days that O2 has been investing heavily in adding EDGE capabilities to its GPRS network, which hints strongly that the UK iPhone will be resolutely 2.5G, not 3G. Boo to that.

What would sweeten the pill would be if Apple announced an expansion of its deal with Starbucks in the US, which is giving iPhone and iPod Touch owners free Wi-Fi access to the iTunes Store. There are seven Starbucks outlets on every British high street (probably), so it’d be logical.

Apple surely won’t try to offload the 4GB iPhone on us Brits, having phased it out in the US, so we’ll presumably be getting the 8GB model. In the US, it costs $399, which is around £200 at current exchange rates. I reckon that means a £250 price tag, probably with a two-year contract with O2 that includes flat-rate data usage. Don’t be expecting a pay-as-you-go iPhone just yet.

In short: tomorrow, Apple will announce that iPhone will be on O2 in the UK, it won’t be 3G, and it’ll cost £250. I’m keeping my fingers crossed that I’m wrong on the 3G score – check back here from 10am tomorrow morning to find out.

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