A patent application filed by Apple was recently outed detailing Apple's plans to set up a virtual network using iTunes. This was to be a precaution, in case AT&T and Apple could not reach a deal. The application details how the network would have worked.

When iPhone first connects to wireless network, it sends iTunes MVNO server it's ID and location, and get's back the information with the available networks, services and rates in the area.

Apple would have set up deals with multiple carriers to use their air waves for their virtual network. The iPhone then would either select what network in the area to use, most likely depending on price. It is suggested the user of the iPhone could have selected their network manually if desired. All billing of minutes and services would have been logged and handled through iTunes.

The patent application was filed in October, 2006, meaning Apple was thinking of MVNO plans long before the iPhone was introduced. Prices would have been competitive, as carriers would have 'bid' prices to Apple for the area. The iPhone also would also have had the capability to use multiple networks. For example T-Mobile for voice and AT&T for data, in any given area.