O2 dumps i-mode; iPhone deal imminent?

British operator O2 is dumping its i-mode mobile Internet service, citing slumping consumer interest and an absence of appealing handsets, The Guardian reports. Telefónica-owned O2 launched i-mode less than two years ago, spending £10m on the service developed by Japanese operator NTT DoCoMo. O2's efforts yielded U.K. subscriber totals totaling only 260,000 active users, although the service has fared far better in Ireland and will continue operations there. O2 already scuttled a planned i-mode launch in Germany.

The news arrives concurrently with reports from Spanish newspaper Negocio, the Madrid bureau of Thompson Financial, claiming O2 has signed an exclusive agreement with Apple to serve as the U.K. network partner for the computing giant's iPhone device. O2 shot down previous rumors of an Apple partnership, but Negocio, citing sources close to the negotiations, says Telefónica already has invested £178 million to launch the iPhone in the British market, and plans to introduce the device at retail "shortly."

For more on O2:
- read this Guardian article

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