iPhone to Sell in China

Unlocked versions already widely-used in the country

Updated 12:00 PM EST, Fri, Aug 28, 2009

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Apple Inc. will get to sell the iPhone in the world's biggest cell phone market now that it has reached a deal with a Chinese wireless carrier, China Unicom Ltd.

Under a multiyear deal announced Friday, the iPhone is expected to go on sale in the fourth quarter, China Unicom executives said in Hong Kong. They declined to give financial details or reveal how much the iPhone would cost, saying only that the price would be "competitive."

Unicom, one of three major state-owned carriers, would be the first Chinese phone company to formally support the iPhone, though unlocked iPhones brought in from other markets are in wide use in China.

China's mobile market trails the United States, Japan and some others in financial size but it has 650 million mobile phone accounts and is seen as a major prize for foreign firms. However, Edward Yu, chief executive at Analysys International, a Beijing-based technology research firm, said it remains to be seen whether the iPhone will appeal to "the mainstream China population."

Chinese media reported that Unicom had secured a three-year exclusive deal to carry the iPhone and had agreed to buy 5 million handsets for 10 billion yuan ($1.5 billion), but Chang said those stories were false.

Analysts at Bank of America Merrill Lynch say the phone could sell for between $99 and $299 with two-year service contracts.

Many Chinese already own smuggled iPhones purchased on the country's thriving gray market. There are well over 1.5 million of the devices in China, according to estimates by BDA China Ltd., a Beijing technology research firm.