The Conseil de la Concurrence (the French competition court) has ordered Apple to terminate its exclusive deal with Orange France and to offer the iPhone through other operators. The court seems to have expedited its decision based on the complaint filed by rival operator, Bouygues Telecom, just in time for the holiday season when many people are buying electronic gadgets. This means Bouygues Telecom and SFR can begin offering the iPhone to customers. The court’s decision is a blow to Orange, which has sold 450,000 3G iPhones in the last five months.
The competition court maintains that Apple’s exclusive deal with Orange introduces even more rigidity in a sector that is already suffering from a lack of competition. The term of exclusivity, 5 years (which the court found too lengthly), was a significant element in its decision. The court stated that exclusivity contracts cannot exceed 3 months.
Orange criticized the court’s decision and Bouygues’s complaint in particular, that is, Bouygues waited almost a year to file a complaint and has been slow in deploying its own 3G network.
The court’s decision is a victory for consumers in France who have been critical about the iPhone’s “locked” nature. By allowing several operators to offer the iPhone, the French court hopes that there will be more price competition. Many other countries’ competition authorities are looking closely into Apple’s exclusive contracts. In the Netherlands and Germany, it is T-Mobile who has exclusivity; in the UK, it is Telefonica O2.
Read Le Monde’s article on Orange losing its exclusive deal to sell the iPhone in France.
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