After months of rumors, Apple’s iPhone will finally connect to the biggest mobile market in the world — China.

Although iPhones have long been available in the country’s gray market, Apple’s deal with China Unicom, announced Friday, finally gives the Cupertino company an official foothold in the land of 650 million cell-phone users. The multiyear agreement means Apple’s signature device will go on sale this fall.

“It’s a big deal for Apple in this sense: You are leaving an awful lot of units off the table when you ignore a country the size of China,” said Needham & Co. analyst Charles Wolf. “China has taken to mobile phones almost like no other country.”

Unicom is one of the three major state-owned carriers, and the only one in China that supports the network standard the iPhone operates on, WCDMA. Neither company revealed many details of the relationship, such as how much the iPhones will cost.

In spite of all the building speculation, Apple issued a subdued statement about its expanding iPhone empire: “We have signed a multiyear deal with China Unicom to bring (the) iPhone to China. We expect the launch to be in the fourth quarter of 2009.”

Wolf believes Unicom will pay Apple a much smaller subsidy than AT&T’s $350 per phone. In the United States, consumers have a choice of three models priced from $99 to $299 with a multiyear service contract.

Because Chinese consumers spend considerably less on wireless services than do American iPhone customers — $10 a month verses more than $90 a month in the United States — they will have to pay more for the hardware, Wolf said. He said the iPhone in China will probably sell for $550 or more.

Apple’s talks with potential Chinese carriers slowed over disagreements about how to share revenue, according to Chinese news reports. But Unicom Chairman and CEO Chang Xiaobin said the companies will not share revenue. Instead, Unicom will buy the phones in batches from Apple and offer them with subsidies, he said.

While individual Chinese consumers spend much less on phone services than their counterparts in the United States, Europe and Japan, their numbers are too large to ignore.

“China is not an easy market to crack,” said Gartner research analyst Van Baker. “There are regulatory issues, there are government issues. There is a limited number of carriers. But anybody who gets into China has a huge, huge potential for unit sales volume.”

“They needed to be in this market,” added William Stofega, an IDC analyst who specializes in global mobile device technology and trends.

The China market could bump iPhone sales by more than five million by 2011, Wolf said. Apple reported that it sold 5.2 million iPhones in the third quarter ended June 27 — a 626 percent jump from the same period a year ago.

Wolf’s estimate for sales in China does not include the gray market of iPhones from Hong Kong that will be equipped with Wi-Fi, he said. Apple will not include a Wi-Fi function on Unicom iPhones.

“It has nothing to do with the technical standard of Wi-Fi,” he said. “The government doesn’t want users to have the ability to send and receive without China having control of that information.”

China’s market is one of the toughest, which is why negotiations dragged on, Stofega said. “I’ll bet you there was a little too much bravado on the Apple side when they went over there to negotiate,” he added.

Apple is entering a fast-moving market of sophisticated mobile phone users, one in which Apple does not enjoy the kind of brand adulation it has in the United States and in parts of Western Europe.

“I think they are going to do well, but I don’t think they are going to see huge, huge volumes,” Stofega said. “I don’t think we’ll see five million sold in one day. And they’ll have to play in a way China Unicom tells them to play.”

Apple is not the only foreign company trying to crack the China market, where Motorola and Nokia have had a major presence for years. Research in Motion plans to launch its BlackBerry smart-phone in China, and Dell is developing a mobile device for China Mobile, the country’s largest carrier with more than 450 million subscribers. Googe’s Android software will soon be deployed on numerous devices.

Apple has sold some 26 million iPhones in 80 countries, though most of those sales have been in the United States.

Some observers believe the Chinese will flock to the iPhone once it is supported by a major carrier and doesn’t come with the headaches of gray-market devices. In China, fancy mobile devices are fashion statements.

“The price will not be an issue,” said Bin Lee, a wireless engineer who grew up in China and is founder of the Silicon Valley China Entrepreneur Forum. “They will sell like hot cakes.”

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