Russian iPhone delay based on old deals
updated 10:20 am EDT, Mon June 16, 2008
Russian iPhone 3G delay
Old pricing schemes are to blame for Russia not being included in iPhone 3G plans, writes the Moscow Times. The newspaper notes that two of the country's major cellular carriers, MegaFon and Mobile TeleSystems, have confirmed that they were previously in talks for iPhone sales, but that Apple's terms were considered unacceptable. It was asking local carriers to buy phones wholesale, says one unidentified company, and additionally demanding 10 percent from each device sold, as well as 10 percent from each subscriber's monthly fee.
That revenue sharing requirement has since been dropped with most carriers in other countries, in exchange for subsidized prices meant to lure in more buyers. Russia's VimpelCom is now said to be "looking at the possibility" of negotiations with Apple, particularly as it is deploying a 3G network in 20 cities over the course of the summer. Apple CEO Steve Jobs has been quoted as saying some sort of Russian deal is likely by the end of the year.
Locals may still have to pay fairly high prices however, as the country does not currently have a contract-based subsidy system. Equally problematic is that carriers are not entitled to compensation should a subscriber break his contract.
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Country specifics
Please note that there are some specifics to the country mobile networks.
Since customers are free to break contract with a carrier any moment and lose nothing, monthly contract payments are moderate in Russia. Competition among leading three networks led to the customers' habit of having more than one active SIM card that are used to gain most benefits from different networks / tariffs. IMO majority still prefer using pay as you go tariffs over subscription-based contracts.
As a result there are no carrier locked phones in Russia. iPhone would have a hard time competing with the rest of the market, having a contract "disadvantage" and being locked to specific carrier. It would sell though, but in no way it could have become a mass selling device under these conditions.