Apple and T-Mobile have been forced to allow an unlocked version of the iPhone to be sold in Germany, after the operator Vodafone won a court injunction.
Apple's unique tactic for its first foray into the cellular handset market has been to sign an exclusivity deal with one operator in each country where the iPhone has been released. In the UK that operator is O2, in the US it is AT&T, in France it is Orange and in Germany it is T-Mobile. Although the exact terms of these deals remain murky, it is clear that Apple uses their exclusivity to negotiate a share of the revenues generated by iPhone contracts.
Last week Vodafone went to the German courts to argue that Apple's deal with T-Mobile was anti-competitive. On Wednesday the court agreed to a preliminary injunction forcing T-Mobile to sell iPhones that are not locked to its network, meaning that SIM cards from rival operators will be usable in the devices. Any iPhone sold in Germany since 19 November will have to be unlocked, free of charge, by T-Mobile if the customer requests for this to be done.
T-Mobile Germany is therefore now selling an unlocked iPhone for €999 (£719) — its price with a 24-month contract is €399 (£287). A court in Hamburg will hear the case in full next month.
In a statement released on Wednesday, T-Mobile said it had no choice but to comply with the ruling. "The legal conditions are attributable to an injunction submitted by competitor Vodafone D2, who was behind T-Mobile in the race to sell the Apple iPhone in Germany," read the statement. "T-Mobile will meet this requirement until the legal aspects have been clarified."
However, T-Mobile argued in its statement that the iPhone's "visual voicemail" feature is still only available through the T-Mobile network and the 24-month contract through which the iPhone is offered. The provider also claimed that its Edge network — the data connectivity technology used by the iPhone — has 100 percent coverage "in the entire T-Mobile network" in Germany.
A spokesperson for Vodafone told ZDNet.co.uk on Thursday that it had resorted to the courts not because T-Mobile had won the German iPhone contract, but in order to establish a "level playing field".
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"We don't want to stop the sale of the iPhone. It's not about the iPhone itself — it could be any handset," said Vodafone's spokesperson. "In Germany, you cannot sell a phone on a long-term contract with the SIM locked in, because it is deemed anti-competitive." The spokesperson also suggested that T-Mobile's price for an unlocked iPhone was "astonishingly high", and confirmed that Vodafone would not be pursuing similar action here in the UK, where the regulatory landscape is different.
Similar regulations are, however, in place in France, where Orange is due to release an unlocked version of the handset — although its release date and price are yet to be determined.
Apple could not be contacted for comment at the time of writing.
Talkback
I am delighted to hear that unlocked iPhones are already starting to be available in Europe. At least it's a start to releasing the iphone to the free market. Roll on unlocked iphones for the UK! I remember being shocked to learn that American telcos insist on locking phones - in a country that is supposed to be famous for its free market. I'm sure this is the reason why America is so behind the Far East and Europe in the development of cellphones. Like many others, I was keen to get an iphone in the UK, but refuse to be locked into an expensive contract for a year and a half.
Unlocking handsets in the past has been 1 easy and 2 had no negative side effect. This is not the case with the iPhone.
Like the Sony PSP the iPhone will receive regular firmware updates via iTunes to add new features or correct bugs and issues. These firmware updates will respond badly to those that have unlocked or jailbreaked their phone. The best case would be you would be unable to use your phone until someone cracks the latest firmware which could be days, weeks or months. Worse case you phone will be permanantly damaged or "bricked". On top of this is that the software used to unlock or jailbreak your phone has no warranty and is likely illegal and breach of warranty so there is always the risk that altering your phone could break it and then mean you can't get a replacement.
For this reason it is unwise to try unlocking your iPhone.
Even if you are succesful and don't mind using a back up phone for a few weeks after each firmware update - it will just mean that the next must have phone will have no simcard reader and will just have a simcard builtin to stop you swapping out your sim.
If you can't afford to pay to play then get an N95 or something. I've seen some outrageous excuses that employees/execs have given for needing an iPhone through work and truthfully it adds nothing to your business unless your business is making iPhone apps or webpages.
You misunderstand me. I meant that legally and legitimately unlocked iphones are starting to be available in Europe.
Personally I won't buy an iphone until I can get one I'm free to do what I like with - legitimately. Apple has lost my business and that of many like me.
By the way, over the next couple of years, apart from alienating many former Apple fans with changes they have made already (eg reducing price in USA) - Apple are in danger of alienating many more early adopters if they introduce improved phones. Two years is a long long time in this fast changing world. In two years' time, folks stuck with an ageing phone are going to feel pretty fed up if they aren't free to change it.
Anyone familiar with Apple knows that Apple never intended to compete with low-end, cheap/giveaway cellphones or highend smartphone.
Apple's identity is about design, usability and user experience in products for those who will pay "a little more" for a superior experience...in all their products.
To provide the best consumer feature-phones, Apple believes that retaining a certain amount of contol over the carrier experience(visual voicemail/non-carrier registration); the software access (itunes/software uploads)/SDK) to ensure stability, compatability, security and user experience. I, and many others, appreciate their philosophy.
Otherwise, we would all be using inferior phones, inferior MP3 players, and PCs with Microsoft...all features limited by carriers, third-party software vendors and Microsoft.
Thanks, but I prefer using Apple products...whatever the cost, to me, they are worth a premium.