Apple had initially planned to sign a distribution deal with a single pan-European operator, leading many observers to conclude that Vodafone–Europe’s largest carrier–was the front runner to secure exclusive European rights to the iPhone.

It’s not yet clear why things don’t seem to be playing out that way, although it may be that Apple’s terms were a bit too onerous for Vodafone. Certainly, it’s not difficult to imagine Vodafone CEO Arun Sarin wincing over the AT&T-style arrangement that is rumored to give a portion of monthly subscription revenue to Apple.

One last point to make here: Contrary to current speculation, people close to the situation said European iPhones will not operate on 3G mobile networks of companies such as Vodafone, but on their slower 2.5G counterparts–just as they do in the U.S.