China Mobile Ltd. (941) failed to get Apple Inc. (AAPL)’s cooperation to make iPhones for its proprietary 3G network. That didn’t stop the carrier from signing up almost 5 million users of the smartphone in four months. Its trick: Offer Wi-Fi instead.

The world’s biggest carrier by subscribers touts the iPhone 4 in advertisements on the Beijing subway and in its shops, and offers gift cards worth as much as 2,800 yuan ($441) to customers prepaying for Wi-Fi service to surf the Web. The company plans to roll out 1 million new Wi-Fi hotspots across China in the next three years.
In two days at Sprint headquarters this week, there was one thing Sprint employees absolutely, positively did not want to talk about: any rumors of a Sprint iPhone.
Sprint’s product chief Farid Adib didn’t smile about the Sprint iPhone chatter, the way various Sprint execs did when journalists brought up the idea of changes in Sprint’s 4G network. In fact, everyone in Overland Park looked a bit weary and a bit irritated about the topic.
But analysts keep wishing, hoping, and asking about the product, because at a basic consumer level, the lack of an iPhone on Sprint doesn’t make sense. Sprint uses the same 3G network technology as Verizon, on the same frequency bands, although Sprint made it clear its phones are tuned and optimized differently. Still, Apple wouldn’t need to build new hardware for Sprint, unlike with T-Mobile USA, which uses a frequency band not available on any current iPhone.
In other words, this looks like a business decision rather than a technology issue. Most people, including many Wall Street analysts, are saying: why the heck not? It wouldn’t require new hardware, and it would open the iPhone up to millions more people. Here are some theories as to why it hasn’t happened yet.