Mobile TeleSystems (MTS) has signed a deal with Apple (News - Alert) to sell iPhone in Russia. The announcement marks the third such deal between Apple and major a telecom operator in Russia. MTS did not disclose which models of iPhone (News - Alert) it will be selling in Russia.

 

Mobile TeleSystems is the largest mobile phone operator in Russia and the CIS (former USSR). Together with its subsidiaries, the Company serves 83.88 million subscribers.

 

There were speculations in the market about MTS deal with Apple a few days ago, especially after MTS’ major rivals VimpelCom and MegaFon (News - Alert) each signed a deal with Apple to sell iPhone 3G in Russia. VimpelCom signed the deal with Apple late August. MegaFon announced the deal on Sept. 2.

 

With MTS (News - Alert) joining the league, the ‘Big Three’ are now offering iPhone to one of world's biggest markets for the device that is already flooded with illegal imports. Reports say that up to 600,000 iPhones have already reached Russia through unauthorized charnels.

 

The iPhone sales in Russia will start this year, say  sources close to the companies. There are speculations about its price as well. One source said iPhone which is sold in retail for $199 and $299 with a contract in the U.S., would cost around $1,000 on a non-contract basis or for a $200 down payment under contract in Russia.

 

Anna Lepetukhina, an analyst at Troika Dialog, said iPhones will probably be available on different networks, and operators will not be subsidizing the handsets. Lepetukhina estimates the official retail price of iPhone 3G in Russia to be between US$600 and US$700.

 

Analysts say Apple decided to strike deals with the Big Three because it wanted to get a good exposure on the local market where buyers can be put off by being able to use a handset on only one network. Apple reportedly plans to sell 3.5 million iPhones in Russia over the next two years through the Big Three carriers.

 

Apple launched its new 3G iPhone in July. With improved and faster Internet access, e-mail and GPS, the prestigious gadget sees a huge potential in Russia, one of the world's fastest growing mobile markets, with its ability to stimulate subscribers to use more value-added services.