iPhone exclusivity to end; as Apple's London store becomes most profitable

Apple looks increasingly likely to break away from exclusive distribution deals with mobile operators. The company has seen the iPhone achieve higher sales, notably in France, when the device is made available to a potentially larger audience that do not want to switch from their existing operator.

Apple could look to hasten this move following the reported surge in France where the iPhone is said to have gained 40 per cent of the smartphone market as against 15 per cent elsewhere.

Commentary from the market research firm Piper Jaffray claims Apple is in the process of slowly transitioning each iPhone market to a multi-carrier model, albeit that this move will mean around 10 per cent less margin per iPhone. But indication that a move in already underway comes from its recent deal in China where its three-year deal with China Unicom is not an exclusive one, and negotiations continue with China Mobile.

The company is thought to be considering a total break with any exclusive deals when the next generation iPhone is launched sometime in 2011.

However, while Apple might give the impression that it can make or break its iPhone exclusivity deals at its own behest, in France the iron fist of the competition regulator was much in evidence in the decision to make iPhones available to other operators.

Separately, details have emerged concerning the profitability of Apple's flagship store on London's Regent Street. The outlet, which sells all of Apple's products, generates over €70 million in revenues per year, making it the most profitable store of its size in the capital - eclipsing even Harrods.

Neil Saunders, a spokesman for the retail research group Verdict, said that Apple's Regent Street store had extremely strong footfall, since it has become a tourist attraction in its own right. "Shoppers pay a premium for the Apple brand, and there is never discounting, so customers don't waver over buying elsewhere."

For more on this story:
Information Week
and The Telegraph

Related stories:
Bouygues Telecom maps out French iPhone offer
Rumour mill: T-Mobile Germany to lose iPhone exclusive
SIM-only and iPhone boost O2 subscriber numbers
O2 to crack down on iPhone tethering cheats
Orange France loses iPhone exclusivity; will UK follow?

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