Reports claim that O2's parent Telefonica may have agreed a deal for exclusive rights on the Palm Pre, leaving Vodafone, which was widely understood to have the contract, empty handed.
If the deal is sealed, Telefonica will have exclusive rights on the much anticipated handset in the UK, Spain and Latin America.
The story initially broke in the Spanish newspaper Expansion, but now there is widespread speculation across the internet. The paper also said that the Pre will be announced on schedule "before summer", meaning it will be released before O2's other exclusive handset, the third generation iPhone.
A spokesperson from Vodafone said: "Vodafone are always talking to leading brands about new handsets. The Palm Pre is an interesting proposition but that is all we are willing to say at this time."
O2 would neither confirm nor deny the rumours and a Palm Pre spokesperson said that no plans for the UK release had been made yet.
The Palm Pre will be launching in the US in the first half of 2009, exclusively on Sprint's mobile broadband network.
