The big mobile phone operators, including O2, are battling for the exclusive rights to Apple’s new iPhone in the UK.

Telefónica, O2’s Spanish owner, is understood to have held preliminary talks with Steve Jobs, Apple’s chief executive, about a potential tie-up in Britain and Europe.

Apple, which launched the iPhone on Tuesday, is expected to offer the revolutionary touchscreen mobile phone exclusively to one network operator when it launches in the UK at the end of the year.

O2, Vodafone, Orange and T-Mobile are all contenders for the contract.

The iPhone is not 3G- compatible, which rules out 3, the next-generation mobile operator owned by Hutchison Whampoa, from the UK bidding. The exclusion is a blow for 3, which has sought to position itself as the UK’s major mobile phone music operator.

Mr Jobs has awarded the US rights to the iPhone to Cingular, the country’s biggest mobile network operator.

Apple is understood to be seeking exclusive contracts with mobile operators in order to secure greater control over the product and customer service offering.

Mobile phone companies might also be prepared to pay a higher price for the rights to have their brand exclusively aligned with the iPhone, which is expected to become a bestseller for Apple.

The share prices of rival mobile phone manufacturers slipped yesterday, amid concern that the iPhone launch could damage their sales seriously. Nokia, the world’s largest handset maker, saw its shares in Helsinki fall by 2.2 per cent to €14.63, while shares in Sweden’s Ericsson eased 0.57 per cent on Nasdaq by early afternoon, although they rose later. Asian manufacturers such as Samsung and LG also saw their shares fall.

Apple’s shares, meanwhile, touched $97.80 on Nasdaq during the day, a record, as analysts raised their price targets on the company in the wake of the iPhone launch.

Britain’s mobile operators are expected to compete aggressively for the exclusive rights to the iPhone, as they seek an edge over their rivals in an ever fiercer market. Music has proved to be one of the most successful mobile phone applications.

Apple’s iPod dominates the portable music player market, with more than 70 million of the digital music devices sold since its launch in October 2001.

Some analysts cautioned yesterday that sales of the iPhone could be restricted by its price. In the United States an iPhone with four gigabytes will cost $499 (almost £260).

The device is expected to cost even more in Britain, although it could be subsidised by mobile phone operators, which regularly offer mobile phones at cut price.

The iPhone is expected to re-ignite the debate over consumer desire for so-called “convergent” devices which merge a phone, camera, and music player into one device.

The iPhone offers three devices in one — a widescreen iPod, a mobile phone and an internet browser in a package only a little bigger than its famed iPod music player.

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