O2, which has the exlusive distribution rights to the Apple (AAPL) iPhone in the UK, may give away free 3G versions of the handset when it comes out next week.
Why? If a customer is willing to take out a huge contract for cellular voice and data service, it may make sense for O2 to throw in the handset. Based in industry information, the cost of the new iPhone will be about $400. The carrier can charge its customers some portion or even all of that. Or, it can offer discounts or free phones to those who will shell out enough in user fees.
The London Telegraph writes that "O2, which has an exclusive agreement to distribute Apple’s iPhone in this country, is set to give away the 3G version of the handset to its highest-spending customers when it launches here next month."
O2 may find that the economy of giving away a $400 phone for a subscriber who will take out a $1,500 annual subscrition plan makes all the sense in the world.
Maybe AT&T (T) will do the same in the US.
Douglas A. McIntyre
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