iPhone Unlocked

I’ve been covering European iPhone developments in my companion blog because I think they give us hints about the future of the iPhone in the US, particularly with respect to 3G. The bottom line:

• European iPhones are due within 6 months
• European iPhone will almost certainly be 3G
• European iPhone will not be tied to carriers due to laws about offering unlocking for a reasonable fee.

The big question is, when will these 3G iPhones be available in the US?

By way of background, at this point, everything about the European iPhone is still a rumor, though a rumor that major mainstream publications feel comfortable repeating. It seems likely that O2 will get the iPhone franchise in the UK, and T-mobile will land the iPhone for Germany. Both are expected to debut the device by November. There is also talk that Orange will get iPhone and France, and O2’s parent company, Telefónica will take a Spanish exclusive.

First, the current US iPhone is a quad-band phone, which means its voice features could work on European GSM networks, but it’s Internet features rely on EDGE technology (and WiFi, of course). EDGE is not widely deployed in Europe. O2 apparently has little or no EDGE infrastructure in the United Kingdom, having made recent investments in a decent 3G UMTS network. It appears the same situation is true for T-mobile in Germany, who has largely upgraded their previous installation of EDGE technology.

The real question is whether EDGE support can be added as cheaply to 3G networks as it was to 2G networks deployed in the last ~8 years.  Apple will have to release 3G phones in Europe within 6 months unless European carriers make major network updates to support the iPhone.

This raises the question of when we will see 3G phones in the US. I’m sure that unlocked European 3G European iPhones they will arrive via the gray-market in no-time. UK carriers must offer unlocking at a reasonable price (Typically the equivalent of~$30-40US), though they can always lock people into long-term contracts as a condition of selling them an iPhone.

Whether Apple starts selling 3G iPhones in the US in a similar 6 month timeframe depends a lot on the costs of hardware that can support both 2.5G & 3G. Apple will eventually have to sell phones that support both in the US so they transition seamlessly as AT&T builds out its 3G network. If the costs of these phones aren’t significantly more than single technology phones, the it might make sense for Apple to make and sell a single global iPhone model in order to recognize the best possible economies of scale.

The big caveat to all of this is that none of the European deals are official. But it seems likely we’ll be able to get 3G iPhones that work in the US within 12 months through either official or gray-market channels.

Please leave a comment if you have further insight.