Deal could more than double the potential buyer for Apple 's smartphone as a carrier battle for 3G customers in \ the world's largest mobile market

China Telecom, the smallest of the three telecom operators in China - but with more subscribers than Verizon, \ the U.S. 's second-largest carrier - it is, with the sale of Apple' s iPhone by the end of the year, according to sources.

Apple would have the CDMA version of its mobile phones, Verizon currently sells in the United States to sell, to work with the systems used by China Telecom. But the move could potentially more than double the number of potential buyers of the device, which was unveiled in January: China Telecom has more CDMA subscribers - 105900000 May - as Verizon, which was to earn the first airline to offer CDMA iPhone year.

The move will also help cement China Telecom 3G users in a more competitive market, are in the handset subsidies, the network operator is squeezing margins.

China has 896 million mobile phone users, a number larger than the entire population of Europe. There are three telecom operators: China Mobile Ltd., China Unicom and China Telecom.

To date, China Unicom is the only operator to iPhones after signing a three-year agreement with Apple to sell in 2009, although it is not on a revenue-sharing system, unlike some other operators in other countries. China Unicom uses GSM technology, the same as that used in versions of AT & T and European carriers.

"The reason telecom operators are fighting for the iPhone business is because everybody is trying to grab as many 3G users as possible," said Jane Wang, an analyst at UK-based research firm Ovum. "The only way to keep costs down is to build up such a user base."

Apple's results for the third quarter results next week. Analysts predict that it will have sold between 15m and 20m iPhones, with an average of 17m. In the first quarter of the year sold 18.6. It is expected that at least one new iPhone will present in September this year.

In May, China Telecom Chairman Wang Xiaochu told a news conference that the carrier had contacted Apple to launch the iPhone on CDMA (Code Division Multiple Access) technology.

"It 's expected to happen this year. China Telecom already has the technology and it all depends on the content of the agreement. As we all know, \ it' s not easy to negotiate with Apple," a source close to the company, says the condition of anonymity, told Reuters.

China Telecom was expected to bring the iPhone in November, said another source.