Hackers, tears and tantrums: the iPhone gets off to a bad start

23 November 2007
Apple's iPhone has come under attack yet again but this time it is not the inflated costs of the handset or the risk of it being hacked that is causing problems, it’s the competition that is blighting Apple's newest addition.

Telecoms giant Vodaphone has taken Apple to court in order to overturn the iPhone exclusivity contract awarded to Deutsche Telecom's T-Mobile.

Now a preliminary injunction has been granted and T-Mobile has been forced to release a version of the iPhone in Germany that is not locked into a specific network or contract.

However the firm has insisted that it will still sell the unlocked phone for an extortionate €999 (£717) until the court makes its final decision, due within the next two weeks, as well as continuing to offer iPhones locked into a two-year contract for €399.

Vodafone Deutschland won the injunction barring T-Mobile from offering the iPhone exclusively with SIM lock, the method that forbids users from switching the device across to other mobile networks. Now T-Mobile has reserved the right to claim damages from its UK rival.

UK T-Mobile has stepped up to reassure customers that there is no indication that the case could be replicated in the UK. A Vodafone spokesman said: "This is particular to Germany. The regulatory situation is very different from the UK, so we won't be doing it here."

The iPhone has been offered to a single operator in each country it is being launched and as part of the deal, Apple receives a certain percentage of phone usage revenues from the service provider.

The German debacle is the latest in a string of problems for the newly launched iPhone. Already there has been a similar exclusivity issue in France where the phone and contract bundling deal promised to France Telecom's Orange was found to be in breach of French consumer law.

In addition, unlocked handsets are now flooding eBay as hackers unlock them before selling them on to people holding contracts with other service providers. And according to a recent survey by GfK NOP, UK consumers have been turned off buying the iPhone as it is too expensive, retailing at £269, and forces them into an O2 contract for a minimum of 18 months.

The research showed that only 2 per cent were even considering adding it to their Christmas list indicating that the iPhone is not quite hitting the mark for the average UK consumer. While O2 has refused to give precise figures for sales over the launch weekend of November 5, reports have suggested that they were far below the expected levels.

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