Elizabeth Judge
2 for 1 tickets to Singin' In The Rain, this coming Monday. Book now
Apple’s iPhone strategy was dealt a fresh blow today when its exclusive partner in Germany — Europe’s largest market — was forced to make the gadget available on rival networks.
T-Mobile said that it would, with immediate effect, make the phone accessible to other mobile operators.
The move followed a legal challenge by Vodafone which claimed that the exclusive deal — under which customers were forced to sign up to a 24-month T-Mobile contract — breached local competition laws.
The decision by the German operator to cave in to opposition from its rivals marks the latest in a series of blows for Apple and its iPhone strategy.
In an attempt to maximise revenues from the gadget — a combined iPod music player, internet surfer and mobile phone — the Californian group negotiated exclusive market by market deals across Europe.
In return for exclusivity the chosen mobile operator had to hand over up to 30 per cent of continuing subscriber revenues to Apple.
It is unclear how that model can proceed in Germany now the phone has been opened up for use on other networks.
The model has also been blown apart in France, where local laws have forced Orange — Apple’s chosen network partner there — to open up the phone to rival networks when it goes on sale at the end of the month.
The UK is now the only European market where the deal remains exclusive to one partner, O2.
In an effort to limit damage, T-Mobile, which launched the phone on November 9, said that it would charge €999 (£720) for an iPhone without a contract.
With a T-Mobile contract, the gadget costs €399.
Enjoy screenings of all the classic films you love, plus take advantage of two-for-one tickets
Have you ever dreamed of owning your own racehorse or a beautiful painting?
Enjoy comfort, safety, space and great design. Plus enter our great competition
Times Online's new TV show helps you make the right decisions for your pet
Are you California dreaming? Explore the wonders of the Golden State. Also enter our fantastic competition
Do you have what it takes to be a Times photographer?
Your brain is capable of more than you might think...
Find out to make the most of your money with our wealth management guides
Need help with your property? We have an entire how to guide - buying, selling, letting, moving, to help you
We are seeking entries for the inaugural Sunday Times Best Green Companies Awards
Enjoy some wonderful inspiring wildlife moments
An interactive preview of the brand new For Your Eyes Only exhibition

Love Sudoku? Play our brand new interactive game: with added functionality and daily prizes

Are you irritable when you return from work? Drained of emotion? You could be suffering from boreout
Prepare for some shock and awe, petrol lovers. Despite the greens trying to wipe it out, the car is about to offer us the most exciting year ever
We've trawled the brochures and websites to find this summer’s best holidays for every taste and budget

Find a course, arrange a game and save money
2007/07
£57,500
South East England
2007/07
£40,995
South East England
2006/06
£41,995
South East England
Great car insurance deals online
£40-55k+benefits+uncapped commission
Morgan Keating
South East
Up to £30,000
GLE
London
£
c£75,000 + executive benefits
Morgan Keating
London and South
Unpaid with travel expenses
Network Rail
Globrix, the property search engine
Visit Times Online Property for homes for sale or rent
Residential development site with planning permission
£1,500,000
Mortgages, bank accounts & money transfers to help you buy abroad
Dinarobin Hotel Golf & Spa 7 nights
From £1830 per person – saving £530.
Walking & multi-activity holidays in Cauterets. Stylish self-catering apartments.
From 350€ for 7 nights.
SAVE 25% on Sandals Luxury Resorts
Great travel insurance deals online
Contact our advertising team for advertising and sponsorship in Times Online, The Times and The Sunday Times. Search globrix.com to buy or rent UK property.
© Copyright 2008 Times Newspapers Ltd.
This service is provided on Times Newspapers' standard Terms and Conditions. Please read our Privacy Policy.To inquire about a licence to reproduce material from Times Online, The Times or The Sunday Times, click here.This website is published by a member of the News International Group. News International Limited, 1 Virginia St, London E98 1XY, is the holding company for the News International group and is registered in England No 81701. VAT number GB 243 8054 69.
You write as though you just fell off the turnip truck from the local farm. Apple and T-Mobile had to know this was a likely outcome. What you refer to as caving in is just another tactical move on both their parts to manage a known risk. No surprises here except to you and your gullible readers.
I can't wait for your slack-jawed amazement at their next move.
Doug Semark, Los Angeles, CA
Of course, the iPhone hackers will acquire an unlocked iPhone when they become available and figure out how to do it on a regular iPhone. Then the cat will be out of the bag...
Michael, Melbourne,
Its not really a set back. Essentially instead of Vodafone and other networks paying Apple a share of their fees, the consumer is paying Apple up front, roughly 600+ Euros. So instead of collecting that amount over two years Apple gets it at the time of the sale. Plus the consumer does not get some services (potentially, I could be wrong), for example Visual Voice mail, may or may not work.
Its a win win for Apple.
MPaul, Tampa, FL
The doors must to be blown off the locked phone and the collusion in the marketplace between the device manufacturer and service provider to limit competition and consumer choice. These rulings are a first step. It is not completely satisfactory but is is a start, a baby step if you will, toward giving consumers choice and freedom. It may also take disruptive technologies in addition to political and market pressures to bring about greater freedoms but this development certainly is welcome.
Richard Prince, Saint Paul, US, Minnesota
It's common practice everywhere for operators to sell phones much cheaper when they are bundled with a contract. The longer and more expensive the contract the cheaper the handset. Are German and French operators forced to offer every handset they supply at a non-contract price?
Nigel, Auckland, NZ
It evidently is a setback for Apple. Presumbly Vodafone do not have to pay Apple as much money as 02 for subsriptions, therefore Apple are going to lose money from it! Furthermore, given the fact that Vodafone aren't having to pay such a high percentage as O2, they are more likely to sell it cheaper, meaning even less sales for 02 and apple.
Tim, Norwich,
I do not believe this is a setback for the model. This is nothing new and has been practice before. Consumrs have a choice whether to buy the phone or not. It comes as a package like "bundling". Anyway, now that T Mobile has changed its terms to comply with the Court ruling, and offer a "phone only" alternative, consumers still have the choice. But can the Court force T Mobile to charge the same price for the phone with and without contract? I doubt. Sounds to me like Vodafone shot themselves in the foot.
Robert, Short Hills, NJ, USA
Just shows you how OFCOM let the telecom companies do what they want while the rest of Europe have laws and regulation for the consumer.
Paul Davis, York, uk
This is not a blow for Apple and T-Mobile. It is an end-run around Vodafone's "victory". Who in their right mind would pay a thousand euros for something they can get for four hundred? Vodafone have won the battle but lost the war. Sour grapes only get you so far!
Stephen, London,