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Friday, November 30, 2007, 10:00 am PT (01:00 pm ET)

Apple iPhone talks with Chinese carriers gone rocky - reports

Multiple reports this week are suggesting that iPhone talks between Apple and China's two most popular wireless carriers — China Mobile and China Unicom — have failed as a result of revenue sharing disputes. China Mobile, however, denies the claim.

The demands by Apple that it receive a percentage of the wireless service revenues generated by would-be users of a localized version of the touch-screen handset have unsurprisingly been met with opposition from both Far Eastern providers.

"Previously, the company intended to cooperate with China Unicom, China's second largest mobile telecoms carrier, but the talks quitted due to the divarication on the sharing proportion of the proceeds," Trading Markets said on Tuesday.

That report was followed Friday by a similar one from the Chinese-language Southern Daily, which stated that negotiations between Apple and China Mobile, China's largest mobile phone operator by subscribers, had failed. The two parties couldn't reach an agreement because of differences over revenue sharing, the paper said.

For its part, however, China Mobile has denied the latest claim, insisting, according to Bloomberg, that it is still in discussions with Apple to offer the iPhone to Chinese consumers sometime in 2008.

Telecom executives familiar with the discussions between the iPhone maker and China Mobile had said earlier in the month that a number of contingencies on Apple's part were likely to prolong the process.

Specifically, there's a precedent among Chinese telecom operators that they do not, under any circumstances, agree to share their revenues with outside parties, as Apple has requested (and achieved) from all of its iPhone partners thus far.

"[O]ur business model does not entail sharing revenue with terminal producers — we don't share revenue. That's a Chinese rule," one executive told Reuters on condition of anonymity. "All it is right now, on the iPhone and Apple, is that the firm welcomes their approach."

Apple stated earlier this year that it hoped to launch iPhone in Asia during the 2008 calendar year.