updated 09:15 am EDT, Fri May 20, 2011
China Telecom confirms negotiating iPhone deal
China Telecom partly put to bed rumors of a deal with Apple by acknowledging that it was in talks for the iPhone. Chairman Wang Xiaochu said his company was "in touch" for a possible deal but couldn't say how far along any deal might be. The current carrier, China Unicom, has an exclusive that ends this year.
The carrier would have to use the CDMA version due to its network and would be only the second so far publicly mentioning a deal. Apple has dropped strong hints of a deal with Sprint in the US and has been rumored in discussions with Reliance and Tata in India.
Apple has seen dramatic growth in China after the launch of the iPad and iPhone as well as the overall popularity of its few but major Apple stores. China Unicom's size, though, has limited the iPhone's potential versus Android. The Chinese government prefers Android and actively supports a China-specific implementation, Open Mobile System. All three carriers support Android and have the help of local companies like Huawei and ZTE.
Adding the iPhone to China Telecom would give access to the third largest carrier in the country at about 38 million potential customers. China Mobile is considered Apple's ultimate prize at 886 million total subscribers but is still in early talks for elements such as TD-LTE support.