Apple iPhone frenzy in Russia fueled by smugglers, jeweler
Thursday, April 03, 2008 - 01:23 PM EDT "Apple Inc. has gained unlikely allies in its bid to boost iPhone sales: Russian smugglers," Alex Nicholson reports for Bloomberg."The device isn't sold by Cupertino, California-based Apple in Russia and it can't be used legally on local networks. Still, about 250,000 people own one, more than any other country except the U.S. and China, according to Eldar Murtazin, chief analyst at Moscow-based Mobile Research Group," Nicholson reports.
"That popularity has turned into a bonanza for traders who sell the phones in kiosks and on the Internet for $1,000 each, more than twice the U.S. price. Hackers say they charge as much as 2,500 rubles ($105) to 'unlock' them so they work locally," Nicholson reports. "'It's an icon for Russians,' said Timofei Kulikov, a lawyer and buyer of electronic products for X5 Retail Group NV, Russia's largest supermarket chain. 'If you see two businessmen at lunch in Moscow, they'll both have iPhones on the table.'"
"The evolution from Web-surfing, touch-screen gadget to status symbol has been a boon for Peter Aloisson. The jeweler sold a diamond-studded iPhone encased in white gold to a Russian businessman in March for 120,000 euros and is working on a 500,000-euro ($783,000) version that may go to another Russian client," Nicholson reports.
Much more in the full article here.

The hotline between the White House and the Kremlin is not a red phone anymore. It's been replaced by an iPhone.