T-Mobile Raked Over Coals For Selling iPhone With Two-Year Contracts - InformationWeek

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11/20/2007
09:46 AM
Eric Ogren
Eric Ogren
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T-Mobile Raked Over Coals For Selling iPhone With Two-Year Contracts

Vodafone is going on the offensive against competitor T-Mobile in Germany. It filed an injunction against T-Mobile claiming that the iPhone's sales terms, which require a two-year contract with T-Mobile, are a no-no. The German court sided with Vodafone and is now forcing T-Mobile to change its iPhone sales practices.

Vodafone is going on the offensive against competitor T-Mobile in Germany. It filed an injunction against T-Mobile claiming that the iPhone's sales terms, which require a two-year contract with T-Mobile, are a no-no. The German court sided with Vodafone and is now forcing T-Mobile to change its iPhone sales practices.This could be bad news for T-Mobile in Germany. The court specifically said that T-Mobile can no longer sell the iPhone with a two-year requirement. No one knows for sure what sort of agreement T-Mobile made with Apple in order to sell the handset, but in the U.S. it is widely believed that AT&T is paying Apple upwards of $18 per month for each iPhone activated on its network. If T-Mobile has a similar revenue-sharing deal in place, this injunction could really hurt the network operator.

Vodafone claims it isn't trying to kill the iPhone, which it lost the rights to sell. Said a spokesperson: "The preliminary injunction filed in Hamburg doesn't mean [Deutsche] Telekom will have to cease marketing the product immediately. We're not taking any plans to replicate these actions anywhere else, or in the U.K." Rather, it wants to be sure European customers are free to buy the iPhone unlocked and use it on the network of their choice, which is common practice in Europe.

The injunction went into effect immediately, and T-Mobile won't have a chance to reverse the decision until another hearing takes place in about two weeks.

If T-Mobile was indeed violating any sort of consumer choice laws, shame on them. But is also seems to me that Vodafone has the taste of sour apples (pun intended) in its mouth.

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