China Unicom appears to be inching closer to a deal with Apple to bring the iPhone to China, the operator confirmed this week. State-run Shanghai Securities News reported yesterday that Unicom – the country’s second-largest operator – had won exclusive rights to offer the iPhone 3G for three years. According to an Associated Press report today, a Unicom spokesman confirmed that talks were progressing but were not finalised. “We have made progress but there are still some problems to be resolved… Both sides have their own timeframe for an agreement but essentially it depends on the practical progress of the negotiations.” Unicom is believed to have opened negotiations with Apple in January after it was awarded a 3G license based on WCDMA technology, the 3G standard compatible with the iPhone.

If confirmed, the deal will end years of speculation as to how Apple intends to launch its iconic device in the world’s largest mobile market. Apple had reportedly been locked in talks with market-leader China Mobile for some time but failed to reach a deal, partly believed to be due to China Mobile objecting to Apple’s revenue-sharing model. Meanwhile, according to Shanghai Securities News, the black market for the devices is thriving, fetching nearly CNY5,000 (US$732) each. The report adds that Unicom is expected to start selling the iPhone at the end of September at a price of no more than CNY3,000. In order to secure the deal, Unicom has agreed to allow Apple to preinstall its online software shop on the iPhone, a condition China Mobile would not accept, the report says, as China Mobile is prepping launch of its own application store.