Jilted Vodafone sparks iPhone wars

Apple is believed to have signed an exclusive deal to only sell the iPhone to customers of the O2 network, due to be formally announced in the next few weeks.

As the sole provider of the phone which will top many gadget lover's Christmas wish lists, O2 will have a big advantage in attracting high-spending tech savvy customers during this crucial sales period.

So its jilted rival Vodafone is making an alternative pitch to customers who want to buy music through their mobile phones, promising unlimited music downloads for just £2 a week.

At that price, users will only be allowed to play the songs on their mobile phones. They can keep them permanently and transfer them to other devices for 99p per song.

The deal will be available on a number of 3G handsets, which will customers to download their new tunes at broadband speed, faster than the old-style networks which the iPhone offered in the US.

The songs will be provided by the music company Omnifone, offering tracks from the four big music publishers, EMI, Sony BMG, Universal and Warner.

The world's largest phone maker, Nokia, is also fighting back against the iPhone threat. Last month it launched its own music portal to rival Apple's iTunes.

Apple underlined the early success of its push into the mobile phone business this weekend, when it announced that iPhone sales had passed one million.

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