iPhone headed for Germany: source

By Nicola Leske and Knut Engelmann

BERLIN (Reuters) - Deutsche Telekom has clinched an exclusive deal with Apple Inc to sell the coveted iPhone in Germany, an industry source told Reuters.

The deal will be announced next week, the source said.

The touch-screen device, which combines the popular iPod music player, a video player and a Web browser, will be sold through Deutsche Telekom's retail outlets in Germany at an initial price of 399 euros ($554), the source said.

Deutsche Telekom's mobile communications unit T-Mobile has agreed to share voice and data revenues generated by the phones with Apple, the source said.

A T-Mobile spokeswoman declined to comment.

Speculation has swirled for months over which European telecom operators will sell the new phone, which has been available in the United States since the end of June.

Apple is expected to hand a UK sale deal to Spanish Telefonica's O2 UK unit, and a French deal to France Telecom's Orange, analysts say, though the companies have maintained strict silence about any deal.

Analysts are expecting initial exclusive transactions in the run-up to the key Christmas sales period to give Apple a share of data revenues and, in an unprecedented move, a share of voice revenues generated by the new phones.