EU Regulators Questioning Carriers Over Apple's iPhone Contract Demands

[Frado]

As reported on The Verge, Apple won't allow the iPhone to connect to a 4G network until after Apple has tested the phone on the carriers specific network. My guess this complaint is being filed by a carrier that does not offer the iphone, is loosing customers to competitors and like the terms offered by Apple.

Yes, the picture in the newspost is from Mobistar Belgium, the only provider allowed to have 4G on the iPhone. Other carriers already offer 4G as well(and better coverage) but nobody with an iPhone 5 can connect to that network. (Unless they fiddle with an iPad ipcc file OR jailbreak their iPhone and hack commcenter).

Imo it's good that the EU wants to look into it.. Apple has had enough time to 'test' the other carrier's network(which is better than the Mobistar network). They obviously don't allow it because of their contract with that Mobistar carrier.

Not to mention you have to pay full price (800 EUR 32 gb iphone 5): you have an unlocked phone but you are limited concerning LTE. Apple shouldn't impose these restrictions if you pay full price.

 

[AppleMark]

Apple tried to take some power from telcos... and almost succeeded, unfortunately android gave that power back to those evil companies.. so for me, whatever apple does to weaken telcos, I am in.. go !

Why are the 'telcos' evil and Apple are not?

I do not understand how you can label one Corporation evil over another, when the ethos of a corporation is to capitalise on anything and everything.

Anyway..., did we not spend last week debating and then being forced to concede that Apple and other corporations can anything they want, whether it is morally reprehensible or otherwise, as long as they do so within the law?

Therefore, if Apple or any other company has breached an EU competition law they should not be above it.

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What? Apple was the company which allowed carriers to disable hotspot, 3G facetime and large apps over 3G.

Carriers might not be able to brand iOS but Apple has certainly made concessions.

Exactly.

Why has Apple only allowed O2 in the UK to enable and support visual voicemail?

 

[Smartass]

As reported on The Verge, Apple won't allow the iPhone to connect to a 4G network until after Apple has tested the phone on the carriers specific network. My guess this complaint is being filed by a carrier that does not offer the iphone, is loosing customers to competitors and like the terms offered by Apple.

let's not forget that Apple is advertising iphone 5 as an LTE supported device but if you're not on an "apple friendly" carrier, you cant use LTE.

 

[throttlemeister]

None of these sales practices are anticompetitive legally speaking and in the abstract. Absolute minimum quantity sales commitments are generally OK as long as they're not tied to percentages of a carrier's overall sales volumes, for example. If Apple funds marketing then Apple should have the right to set reasonable rules for how those funds are used -- but Apple cannot dictate how other marketing funds are used (except to prohibit outright disparagement), nor can Apple tie a carrier's marketing funds to a percentage of the carrier's overall marketing budget, for example. "Most favored pricing" contracts are generally OK too as long as the carrier is free to strike identical "most favored" contracts with other equipment manufacturers.

The EU needs to be careful not to confuse a strong negotiator able to secure highly favorable contract terms due to its strong products with an anticompetitive negotiator that is doing something illegal. Generally speaking Apple knows exactly where the line is between aggressive negotiation and illegal anticompetitive behavior. Also, the EU needs to be careful not to protect incumbent carrier cartels. The EU governments granted the carriers wireless spectrum franchises which are limited in supply. There are no comparable barriers to entry among smartphone manufacturers. Apple may have succeeded in shifting profits from carriers to Apple, but to the extent that's happened the shift has only accrued to the benefit of consumers who can choose among a wide variety of Apple and non-Apple smartphones to use on networks that charge much lower rates for voice and data services. In other words, Apple may have helped tame the carrier cartels which then increased the overall market and boosted the fortunes of Apple's competitors (including Samsung and Google) over those same carriers that can no longer charge as much for more open networks. It would be ironic and sad if the EU penalized Apple for what seems to be a pro-consumer accomplishment.

There have been some reports of smaller carriers that were forced to buy minimum quantities of iPhone that were so large for that carrier it essentially forced them to drop any other phones just to be able to get rid of them. At the same time, the market demands those carriers to offer the iPhone, or they will lose too many customers.

If this has indeed been the case, we are no longer talking about strong negotiators, but about intentially disrupting the market and trying to push competitors aside by strong-arming the carriers.

Now, I don't have proof about this, so far it has just been some reports in the press, but I am quite sure these are the types of things the EU wants to know. If it did happen, the EU will probably launch a formal investigation into Apple (which this is not).

 

[69650]

What other company could stand this kind of intense scrutiny?

Microsoft, Google, Amazon, etc.

They've all been or are being investigated by authorities around the world including the EU.

Whatever the company or the industry sector if you have a dominant market share, the competition authorities have an obligation to make sure you don't abuse that position. In the end all they are trying to do is protect us the consumer.

If they've done nothing wrong then they've nothing to worry about.

 

[rdlink]

Whilst it may be good business to use a position of strength (i.e. carriers can't afford not to carry the iPhone), it's also often not in the consumers' interest to allow companies to exploit this type of advantage to the extent that it can dictate and manipulate the market.

In some ways I like the fact the Apple has turned around the carrier/supplier relationship, I don't have to suffer a carrier's splash screen and bloatware on a carrier-crippled device when I use my iPhone like I always used to have to when carriers called the shots, but when it comes down to trying to gain an unfair advantage that isn't open to the competition then I think the EU is right to step in to ensure the playing field remains level and consumers don't lose out.

While I agree with the underlying point of your post, I believe Apple has done more to benefit the consumer with the iPhone than any phone manufacturer in history. First, the iPhone itself was revolutionary in design, features and build. Second, as you stated the carriers can't pervert the phone for their benefit and the consumers' detriment like they do with other manufacturers. That is huge.

Think back to the Motorola Razr. One of the most popular feature phones of all time. Yet Verizon was allowed to cripple many of it's native features to force the consumer to use their paid services to do things that the phone could have done natively for free. One feature that comes to mind was the ability to synch the phone with your Exchange address book. You could do it for free, except for the fact that Verizon crippled it, and forced you to buy a similar and klugy service from them if you wanted it.

That's what I see as a big problem with Android. It allows the carriers and manufacturers to put crapware on the phone that can't be removed (without rooting) and also allows them to control the OS version.

 

[MacMan1620]

Apple should stop selling in Europe all together. Screw the EU and their ********* tactics. Then you'd see a true European revolution by the people.

 

[kevinof]

Utter rubbish. Apple is in Europe for one thing only and that's to make $'s , therefore it has to play by EU rules. Its free to leave if it wants (but I doubt it will).

Having lived and worked in both the U.S. and EU I'll take the EU any day when it comes to looking after the consumer.

Apple should stop selling in Europe all together. Screw the EU and their ********* tactics. Then you'd see a true European revolution by the people.

 

[Sincci]

Apple should stop selling in Europe all together. Screw the EU and their ********* tactics. Then you'd see a true European revolution by the people.

And let's not just stop at EU while we are at it, Apple should stop selling their products outside of the US since they have been treated so unfairly in Australia, China, South Korea, Japan and so on. Yeah, screw the profits on those countries!

 

[AppleMark]

Apple should stop selling in Europe all together. Screw the EU and their ********* tactics. Then you'd see a true European revolution by the people.

What the...

You forgot to add the smiley face to denote that you were joking....? Or maybe you were not..

People will not rise up for anything anymore... Just look around you. And Apple will never abandon a lucrative Market, hostile or otherwise.

I was thinking of burning down my town hall over the withdrawal of the Mac Pro, but could not gather enough support.

Viva la revolution!!!!!

 

[MacMan1620]

Yeah I guess they didn't see the sarcasm. People on this forum need to really get out more

 

[Dr McKay]

Apple should stop selling in Europe all together. Screw the EU and their ********* tactics. Then you'd see a true European revolution by the people.

Yea, how dare the EU investigate potentially anticompetitive tactics and look out for the consumer! /S

Apple should definitely pull out of Europe despite there being way more people there to sell to, just out of spite. You should go to business school.

 

[Frado]

Yeah I guess they didn't see the sarcasm. People on this forum need to really get out more

With all those American patriots you can never be too sure..

 

[samcraig]

I'm sure some anonymous concerned party (competitor) lodged a complaint. If apple requires a commitment to invest in making their popular phone compatible with a certain carrier and the carrier clearly as other options, them what have they done wrong? These same companies benefit from Apple's loyal customers and marketing. Many of the phone companies don't promote the iPhone once the get going. they push any and every other phone.

Or you know - maybe it was one of the carriers who either couldn't negotiate a fair contract and/or got "stuck" being forced to be responsible for X number of units...

Oh - but CLEARLY it has to do with another phone manufacturer - right?

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Why are the 'telcos' evil and Apple are not?

I do not understand how you can label one Corporation evil over another, when the ethos of a corporation is to capitalise on anything and everything.

Anyway..., did we not spend last week debating and then being forced to concede that Apple and other corporations can anything they want, whether it is morally reprehensible or otherwise, as long as they do so within the law?

Therefore, if Apple or any other company has breached an EU competition law they should not be above it.

----------



Exactly.

Why has Apple only allowed O2 in the UK to enable and support visual voicemail?

Some people like the champion companies I guess. It makes little sense as all companies want the greatest profits.

Why do people cheer Apple's quarterly reports (if they don't own stock) and how much profit they make while at the same time complaining they are getting ripped off by telcos or cable companies.

Again - makes little sense.

 

[b0fh]

What? Apple was the company which allowed carriers to disable hotspot, 3G facetime and large apps over 3G.

Carriers might not be able to brand iOS but Apple has certainly made concessions.

Enough public pressure have caused the reversal of these concessions by the telcos.

But no crapware from the beginning... that's just heavenly!

 

[abz1981]

Apple should stop selling in Europe all together. Screw the EU and their ********* tactics. Then you'd see a true European revolution by the people.

I guess next your going to stop buying French fries and stick to freedom fries instead?

 

[Ironduke]

Apple should stop selling in Europe all together. Screw the EU and their ********* tactics. Then you'd see a true European revolution by the people.

do you seriously believe what you just said?

if so LOL violentlty at you

 

[DMH3006]

Yes, the picture in the newspost is from Mobistar Belgium, the only provider allowed to have 4G on the iPhone. Other carriers already offer 4G as well(and better coverage) but nobody with an iPhone 5 can connect to that network. (Unless they fiddle with an iPad ipcc file OR jailbreak their iPhone and hack commcenter).

Imo it's good that the EU wants to look into it.. Apple has had enough time to 'test' the other carrier's network(which is better than the Mobistar network). They obviously don't allow it because of their contract with that Mobistar carrier.

Not to mention you have to pay full price (800 EUR 32 gb iphone 5): you have an unlocked phone but you are limited concerning LTE. Apple shouldn't impose these restrictions if you pay full price.

Of course they can't,Apple probably signed exclusivity agreements with those carriers,same as AT&T until the launch of the iPhone 4 Verizon.

I don't think there's anything wrong,you buy an unlocked phone but you know certain features are only on official carriers.

 

[derbyshire2013]

Why are the 'telcos' evil and Apple are not?

I do not understand how you can label one Corporation evil over another, when the ethos of a corporation is to capitalise on anything and everything.

Anyway..., did we not spend last week debating and then being forced to concede that Apple and other corporations can anything they want, whether it is morally reprehensible or otherwise, as long as they do so within the law?

Therefore, if Apple or any other company has breached an EU competition law they should not be above it.

----------



Exactly.

Why has Apple only allowed O2 in the UK to enable and support visual voicemail?

I'd like to point out 4GEE customers can also access Visual Voicemail on iPhone now, and I believe (but may be wrong!) Orange UK customers on a plan of £36 or over can also get it too.

 

[AppleMark]

I'd like to point out 4GEE customers can also access Visual Voicemail on iPhone now, and I believe (but may be wrong!) Orange UK customers on a plan of £36 or over can also get it too.

Thanks for the update. When I bought my 4S (contract free) I switched from O2 to Vodafone as their plan was better for sim only at the time. It was only then I was made aware that only O2 were 'allowed' to support visual voicemail because they were the initial partner.

I had to begrudgingly go back O2, as no visual voicemail was a deal breaker for me.

 

[Smartass]

I don't think there's anything wrong,you buy an unlocked phone but you know certain features are only on official carriers.

Everything IS wrong with that. If you buy an unlocked phone, you should have ALL the features that the phone provides. The end. No bull-****** excuses from Apple like "well we havent tested our phone on your network so no LTE for you". Thats the whole point of the unlocked phones.

 

[DMH3006]

Everything IS wrong with that. If you buy an unlocked phone, you should have ALL the features that the phone provides. The end. No bull-****** excuses from Apple like "well we havent tested our phone on your network so no LTE for you". Thats the whole point of the unlocked phones.

No the point of unlocked phones is to be able to use it on any GSM network,not to have all the features on it,buying unlocked only means you can choose the career,obviously there will be advantages for choosing an official carrier.

It seems in your mind just because its unlocked it should be full featured in every possible network which is not the case.

 

[Smartass]

No the point of unlocked phones is to be able to use it on any GSM network,not to have all the features on it,buying unlocked only means you can choose the career,obviously there will be advantages for choosing an official carrier.

It seems in your mind just because its unlocked it should be full featured in every possible network which is not the case.

wait are you serious or is that just some sarcasm? You honestly think that if you buy an unlocked phone that its ok that you dont have LTE on it because that carrier is not an offical Apple partner? It's like you would buy a car and if you dont go to a certain gas station pump company your car would only go to 100km/h and no more. Seriously? No wonder Apple does these kind of stupid things if people like you think that this is completely normal.

 

[derbyshire2013]

Thanks for the update. When I bought my 4S (contract free) I switched from O2 to Vodafone as their plan was better for sim only at the time. It was only then I was made aware that only O2 were 'allowed' to support visual voicemail because they were the initial partner.

I had to begrudgingly go back O2, as no visual voicemail was a deal breaker for me.

No problem.

It is daft that o2/Orange/EE are the only ones to support it in this day and age (and given the amount of people who have iPhone in the UK) but nothing would surprise me

 

[blackburn]

Carriers? Screw em'. When you can get most phones unlocked for the same price or even cheaper, why would you buy a phone though a carrier unless you are a corporation with a contract?

They should split the operator and cell phone sales, or at least prevent carriers from screwing up phones and get the updates timely (fortunately that doesn't apply to the iPhone).

The only problem I saw with iPhones through an operator was that it was almost always sold out for the companies and always in stock for the regular consumer.