Major European operators will refuse to subsidize Apple’s iPhone if the handset firm launches devices with an embedded SIM.
Vodafone, France Telecom and Telefonica have privately expressed concerns over Apple's rumored efforts to develop an integrated smart SIM for iPhone, which would allow buyers to choose a carrier when activating the device, FT.com reported.
One senior executive said Apple risked a “war” in Europe over the new activation model, which analysts estimate could cut global iPhone sales by 12%, the news site said.
Operators fear the move would prompt a spike in customer churn as it eases the process of migration, and would lead to a decline in the duration of telecom contracts.
Such a model would even allow Apple to enter markets as a connection services reseller with an inbuilt competitive advantage, the sources said.
Rumors that Apple is working with smartcard firm Gemalto on the embedded SIM broke late October – a view backed up by sources at several European operators.
Analysts contacted by Telecoms Europe.net confirmed they were aware of the rumors, but said they couldn’t comment on the development until Apple or Gemalto issue official statements confirming the collaboration.