Apple’s German iPhone network operator, T-Mobile, is fielding one of the most aggressive discounts yet announced on the iPhone 3G – offering it for just one Euro on its more expensive tariffs.

This massive discount is bound to generate significant sales of the next-generation iPhone when it goes on sale on July 11, in a defiant response to claims iPhone sales there didn’t meet expectations.

Deutsche Telekom CEO Rene Obermann last month confirmed that 100,000 iPhones have been sold in Germany since its launch last November, saying it has become the most popular multimedia device the company sells.

Now, customers agreeing to a new two-year contract with their 8GB iPhone 3G will be entitled to the discount cost, on a monthly contract of €69. This model will cost €169.95 on the entry-level €29 tariff. A discount also on the 16GB version, whcih will cost from €19.95 euros with an all-inclusive data plan costing €89 euros per month, rising to €249.95 for customers choosing the lowest-priced, €29/month tariff.

T-Mobile parent company, Deutsche Telekom, says the move is designed to boost take-up and use of its 3G services, offering data transmission speeds of 3.2mbps. iPhone users consume 30 times as much data as users of other Internet-enabled phones.

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