Germany vs. Europe
I do not want to justify the "ugly" rates but i want to help understand the ridiculous price structures here in europe.
The German situation does not reflect telecom sector in Europe in general. Their former national telecom operator (DT) used to do everything to make life difficult for competition. The German government also collected tens of billions of euros of tax-like fees from the operators back in 2000 (the 3G license auction).
If we talk about the telecom sector at the EU level, the situation is different. The Commission tries to open the market as well as possible. I have seen several comparisons of call prices in the EU. The results depend on what is compared (how many minutes, SMSs, data plan, etc.), but in general Sweden or Finland tend to be the least expensive and Germany the most expensive, the difference being roughly triple.
There is a positive feedback in this. When the call prices are reasonable, people call a lot. Almost everyone has a cell phone, and land lines are disappearing rapidly. This ensures a lot of income to the carriers as the net number of call minutes is high. The more there is traffic the less the network costs per minute/megabyte/whatever.
In several European countries operator locking is very strictly regulated, as it tends to dilute competition. This seems to have a strong correlation with call charges. Of course, the carriers know this and lobby against it very desperately. The trick Apple is trying is simply against the European Commission thinking.
Of course, one might think that fierce competition makes the carriers unprofitable and thus the networks will deteriorate. They haven't as people keep on demanding 3G, 3.5G, 3Gturbo, etc. No one will keep using a network with bad coverage.
Summa summarum, Germany is a very bad sample if you want to say something about the telecom sector in Europe.