German court to T-Mobile: Sell the iPhone without a contract

Rivalry between Germany’s T-Mobile, the official iPhone carrier and Vodafone is getting ugly. Vodafone made a legal move against T-Mobile to force it to sell the iPhone without a contract and as an unlocked device. The court has apparently sided with Vodafone and has handed an order down to T-Mobile to sell the iPhone without tying it to a service contract. More on the situation can be read on Apple Insider.

Apple has managed to create a such a strong brand and appeal for the iPhone, enabling it to for revenue sharing agreements onto mobile carriers. This is unheard of in the mobile industry, where carriers dictate all the rules usually.

But Apple’s upper hand also has the side effect of locking the iPhone down. Nokia is shooting back with a more open strategy, and Google is gathering partners for the Open Handset Alliance. Will it be a battle between open and closed systems.

Apple has already made one move to be more open. Come February 2008 and Apple will give developers a Software Development Kit that will enable them to write applications for the iPhone. Applications are already being written for the iPhone, but it has to be hacked to accept them.

And people, probably in their tens or hundreds of thousands are already unlocking their iPhones from AT&T.

A German friend who has bought the iPhone the minute it was out in Germany, was complaining about being forced to take out a new mobile subscription (his old phone and number now ring in some drawer somewhere in his house and that why I wasn’t able to reach him one morning recently!)

Vodfone in Germany might be more motivated by corporate interests rather than consumer interests. But its legal success against T-Mobile (which the latter intends to dispute, of course) is a sign that Apple’s strategy of locking its phone down to certain carrier and extract money out of them (because it can) might not fly so easily everywhere.


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