Apple, the world's most profitable mobile phone-maker, has denied working on a plan to market communications services directly to consumers and bypass the telecom companies on which it has long relied to sell its products.
Business Insider on Monday reported the iPhone-maker was testing a mobile virtual network operator (MVNO) service in the United States, which would involve it renting capacity from one or more network operators to sign up customers to its own phone and data plans. The mobile phone-maker is also in talks with European operators about such an arrangement, the Web site reported.
"We have not discussed nor do we have any plans to launch an MVNO," said an Apple spokesperson in a statement yesterday.
Since it first launched the iPhone in 2007, carriers ranging from AT&T and Deutsche Telekom AG to China Mobile have played a key role in ensuring the success of Apple's move into the mobile phone business.
The carriers buy huge numbers of mobile phones from Apple then resell them to customers who sign long-term contracts, often at a discount. Any move to sideline the carriers by going directly to consumers is therefore risky for Apple.
Apple recently reported it sold 48 million iPhones in the quarter through June, raking in $31.4 billion in revenue, or 63% of its total sales.
In order to ensure maximum coverage to its customers, Apple has moved away from an early focus on exclusive deals with single operators in key markets, to work with as many operators as possible.
Last year, the company launched an own-branded Apple SIM card that allows consumers using its iPad tablet devices, but not its phones, to switch services between network operators. Several top operators in the US and Europe support the Apple SIM.
By contrast, Silicon Valley rival Google earlier this year unveiled an MVNO service in the US. The Google service, known as "Project Fi", is being run in conjunction with US operators Sprint and T-Mobile USA. It connects customers to the fastest available service by seeking out available local WiFi hotspots before, as a backstop, connecting to the telecom networks of its partners.
Apple shares, which fell as much as 4.4% in the first 90 minutes of Nasdaq trading on Tuesday, steadied after the denial to be down 3.1% by 16.42 GMT.
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