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European Carriers Complain To EU About Anti-Competitive Contracts With Apple 146

Posted by timothy from the we-don'-wanna dept.
whoever57 writes "Several European phone carriers have complained to the EU about the contracts that Apple imposes on them if they want to sell the iPhone. Because the contracts stipulate a minimum purchase, and the Carrier must compensate Apple if they fail to sell through that minimum, it has the effect of forcing the carrier to promote iPhones ahead of alternative phones. The European Commission is monitoring the situation. Apple claims that its 'contracts fully comply with local laws wherever we do business, including the EU.'"
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European Carriers Complain To EU About Anti-Competitive Contracts With Apple More

European Carriers Complain To EU About Anti-Competitive Contracts With Apple

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  • Now you know how your customers feel, carriers! (Score:5, Insightful)

    by jaskelling ( 1927116 ) on Saturday March 23, 2013 @02:18AM (#43255249)
    So...carriers...you signed a contract. It's something you can't get out of because it's something you NEED to have to succeed. But...the prices are exorbitant, you're being bent over and pounded from behind, and you feel you have no recourse, no matter how much you bitch and whine? Congratulations! Now you know how every single one of your customers feels on a daily basis. You're not going to get one iota of sympathy from me.

    • Congratulations! Now you know how every single one of your customers feels on a daily basis.

      Being bent over and pounded is not a service my carrier provides. I just give them AU$20 a month to make calls and use data.

      If being bent over a barrel isn't a lifestyle choice for you, you should change your carrier.

      • Here in the US we don't have a "non-barrel" option, though there is some flexibility in the "backside frequency" rate. But in our defense, our government does this to us all the time by bending over backwards to help big business do this to customers. I believe we even pay extra taxes to help buy the barrels.

        • Actually we do. My wife and I left a big carrier and went with a smaller one. 1500 minutes and a small data plan (I normally use WiFi) for $50 mo and no contract.

          I bought used phones and now our bill is a fraction of what it was...

          Is $50 better = yes. Could and should it be cheaper = yes.

          • Re: (Score:1)

            by zidium ( 2550286 )

            Are you serious?

            We use My Simple Mobile [mysimplemobile.com]...

            • Unlimited voice
            • Unlimited long-distance
            • Nationwide
            • Unlimited data
            • Android phone
            • T-Mobile network
            • $50/month!! NO CONTRACT!

            • Re: (Score:2)

              by emj ( 15659 )

              • Unlimited data
              • Android phone

              Are you sure? What kind of phone and what kind of unimited data?

    • Re: (Score:1)

      by Anonymous Coward

      you're being bent over and pounded from behind

      Now you know how every single one of your customers feels on a daily basis.

      And they haven't even the common decency of giving a reach around

    • Surely this must fall under the same legal premise for the EU anti-monopoly actions against Microsoft in the late 90's? The position occupied by Apple in the smartphone market is comparable to the position held by MS in the operating system market back in 1999. Android might sell more as a whole segment but it is seriously fragmented with no peer to Apple other than Samsung. Good luck to the EU. I hope they do take some action on this.

      • Re:Now you know how your customers feel, carriers! (Score:5, Insightful)

        by beelsebob ( 529313 ) on Saturday March 23, 2013 @05:25AM (#43255715)

        You're right... 96% share, with your closest competitor having 3% share is *really* similar to 20% share, with one competitor having 35% share.

    • We're the ones doing all the raping and pillaging, but Apple is getting all the profit from it because something known as "a product people want". We need immediate legislation so that we get to keep all the profit from the raping and the pillaging.

    • Re: (Score:3, Insightful)

      by Splab ( 574204 )

      Did you read the part that said EU?

      We have fierce competition on the mobile market in most of EU; if you are bound by a contract it's because you are paying off your phone bought on credit, one month cancellation term is the norm else.

      In fact, the competition is so fierce in Denmark now, you get unlimited voice, SMS, MMS in almost all subscriptions, only thing varying these days are the data plans.

      • "In fact, the competition is so fierce in Denmark now, you get unlimited voice, SMS, MMS in almost all subscriptions, only thing varying these days are the data plans."

        Ditto here in Luxembourg. For under 50€, I have unlimited voice to all carriers and landlines, unlimited SMS and MMS and data. Being a small country, for an additional 5€ a month you can also get international calls and SMS etc to the countries around us.
        That's with a contract where the iPhone came with, if you buy your own phone it

    • Re: (Score:2)

      by skine ( 1524819 )

      You can get out of a signed contract if that signed contract is illegal.

    • So...carriers...you signed a contract. It's something you can't get out of because it's something you NEED to have to succeed. But...the prices are exorbitant, you're being bent over and pounded from behind, and you feel you have no recourse, no matter how much you bitch and whine? Congratulations! Now you know how every single one of your customers feels on a daily basis. You're not going to get one iota of sympathy from me.

      ===
      But if you want their service, you will have to pay for the Apple portion as well as what you think they are doing to their customers

  • the irony... (Score:2)

    by Anonymous Coward

    ...of cellular carriers, the most despised, bullying, and customer-hating organisations - monopolies, often - on the face of the earth, are crying because someone bigger than them is calling the shots for a change. the shock alone must be causing them to palpitate. even better - its because of *unfair and one-sided contract terms*! I laughed so hard I swear my spleen burst.

    • ...of cellular carriers, the most despised, bullying, and customer-hating organisations - monopolies, often - on the face of the earth, are crying because someone bigger than them is calling the shots for a change. the shock alone must be causing them to palpitate. even better - its because of *unfair and one-sided contract terms*! I laughed so hard I swear my spleen burst.

      Actually here in Europe the carriers have something you in the US seem to lack. We call it competition. Personally I am very happy with my carrier. No monthly fee for the basic subscription and a decently priced data plan. The Apple contracts are in sharp contrast with the rest...one of many reasons why I would never contemplate buying an iPhone.

    • Also one of the most heavily regulated to enforce competition, especially in the EU.

      They know anticompetitive behaviour when they see it.

  • Easy way to fix this problem (Score:5, Insightful)

    by JDG1980 ( 2438906 ) on Saturday March 23, 2013 @02:23AM (#43255265)

    You know what the easiest way is to solve this problem? Completely separate the business of providing cell/wireless service from the business of providing the actual phones. If you want an iPhone, you buy it from Apple at whatever they are actually charging (none of this "subsidized" multi-year contract BS). Then you buy a service package for whatever carrier you want. Either month-to-month or long-term.

    Bundling the phone and service together has been horrible for consumers (we get locked-down devices loaded with crapware and stuck with terrible contracts) and now even the carriers don't like it? Enough.

    • Belgium does that (Score:1)

      by Anonymous Coward

      All phones are unlocked, and you can switch providers and keep the number. You can get subsidized phones, but then again you can just buy a phone from anyone on credit anyway and buy a service from any of the telcos.

      But really who needs Apple? There just isn't a killer app for iPhone now that isn't available on Android, and usually better on Android.

      So why not just skip the iPhones altogether at this point, if a user wants it, they can buy it unlocked mail order from one of the countries that sells them unl

      • Re:Belgium does that (Score:5, Insightful)

        by Stormwatch ( 703920 ) <rodrigogirao@noSPAM.hotmail.com> on Saturday March 23, 2013 @02:36AM (#43255297) Homepage

        But really who needs Apple? There just isn't a killer app for iPhone now that isn't available on Android, and usually better on Android.

        People want the brand. It's like those Beats headphones: crazy expensive, subpar sound, "all my friends have those so I gotta have 'em too".

        • Re:Belgium does that (Score:5, Interesting)

          by walkerreuben ( 2837841 ) on Saturday March 23, 2013 @03:05AM (#43255367)
          As a computer nerd who owns an iPhone 5 and a Galaxy S3, I can tell you that no matter what I do with my Galaxy, my iPhone is still easier to use, more simple to navigate, and is always more stable. It does everything I need it to. The Galaxy. That's my fiddle phone. I can do anything I want with that phone, and it rarely complains. I can install different operating systems, I'm pretty sure I could dual boot if I wanted to. But so far every single thing I've done on my Galaxy that I couldn't do on my iPhone has been things only a nerd or geek would want to do. (Apart from use a proper Google Reader app, but that's no longer a problem with what's happening to it.) So in the end of my 6 month review of the two phones, I've come to the conclusion (I came to it ages ago actually) that while the Galaxy is the superior phone in nearly every way, the iPhone is the phone that's going to let the average customer do everything they need to do with hardly any worries. (It also feels stronger.) The average non-tech person who gets a smartphone doesn't want to dual boot it, they just want to use it. That's why Apple is so successful. (And when some damn saleperson talked my grandmother into getting a cheap android phone, I felt like taking it to the shop and stuffing it up ....... never mind. That was made worse by most of her children using iPhones and iPads.)
          • What I would miss the most if I were to leave my Desire Z behind would be the keyboard. My phone is not the newest or fastest around, but I love that keyboard, and my wife is jealous of the cam quality, which is better than hers on her much newer Sony XPeria Go. Oh. And xmbc. Need that.

          • Ironically (Score:2, Insightful)

            by tuppe666 ( 904118 )

            my iPhone has been things only a nerd or geek would want to do

            Its kind of sad your trying to troll Android vs Apple based on subjective comments [and personal attacks]...you hit all the check boxes, but you ignore the fact that this article is about Carriers standing up to Apple, something they are doing 6 years after launch because, well their dependence on Apple is not once it once was, simply because other companies are providing smartphones that outsell Apples several times, because customers are choosing them over Apple.

            • what phone model outsells the iPhone? I don't think the galaxy s3 does. It's the best single selling cell Phone I think, though not the biggest company or biggest operating system in europe.

              • Re: (Score:2)

                by cbope ( 130292 )

                Wrong. Recent numbers put Samsung quite far ahead of Apple globally. Please do your research.

                • Re: (Score:2)

                  by Wovel ( 964431 )

                  Sure if you include the $4 to manufacture "smartphones" they sell in the third world. :)

                • really? which model by samsung outsells the iPhone? here is a hint:
                  teh iPhone 4s, an old model, outsold the galaxy s3 in 2012 4Q, when teh 4s had a much more powerful update available and the s3 was the top in class for samsung. In fact, thanks for your snide, completely incorrect reply, it definitely made me go look up how dominant apple still is in the markets it has released phones

          • I don't know. I can see plenty of non-nerds wanting to able to add extra storage without having to buy a new device, have the ability to block unwanted calls, mark texts from certain numbers as spam or use Swype to name but 4.

      • Re: (Score:2)

        by Wovel ( 964431 )

        You live in Bizzarro world. There are actually no apps that are "better" on Android. It is a technical impossibility.

    • Re:Easy way to fix this problem (Score:5, Informative)

      by Fuzzy Viking ( 1140767 ) on Saturday March 23, 2013 @03:14AM (#43255395)
      Which is why I always buy phones without carrier lock-in. Which is an option here in Norway :)

      • Re: (Score:1)

        by Anonymous Coward

        It's an option everywhere, even here in the states. But people balk at a $400 price tag, even though you'll save twice that much over the course of a contract if you actually do the math. I did when I bought my Galaxy Nexus, and plan to buy unlocked phones from here on out.

        • I call bullshit.

          What carrier are you using in the United States that actually charges less if you don't subsidize the phone with them?

          No one in the US buys phones outright because doing so is fucking retarded. The monthly fee remains the same regardless of if you buy it at full price or with a contract. Even if you buy it with a contract and cancel the contract before you even walk out of the store it IS STILL CHEAPER THAN PAYING FULL PRICE, at least on $400 and above phones.

          • Re: (Score:2)

            by zyzko ( 6739 )

            Exactly. Cell service prices in the US are expensive, but that is mitigated by the fact that you can get the handset for quite a good price by paying monthly fees.

            And $400 is low price for the latest high-end models, HTC One, iPhone 5 and Galaxy S4 are all at ~700€ mark in Europe unlocked depending on the tax rate where you buy them. For reasons that are quite sensible, people tend to opt to cut that into 24 separate payments, and cell phone companies love that. The problem is the additional cost of ma

    • Comment removed based on user account deletion

    • Re: (Score:2)

      by cbope ( 130292 )

      Here in Finland it is illegal to tie the service and the phone together, that is unless you buy subsidized. And most people know what a horrible deal subsidized phones are, so few people buy them. In fact, subsidized phones only started appearing here around the time of the iPhone launch, not before (Apple, go figure).

      Numbers must be portable also. And I can take my phone and pop in any SIM I want to and it will work just fine. Hell, my last phone (Lumia 820) I bought from a friend in Germany who was on T-M

  • Or just stop buying them (Score:2, Interesting)

    by Anonymous Coward

    Because if carriers stopped buying and selling apple products they would eventually fix their contract problem. Sign a contract with other carriers stating that for a year there would be no selling of i-products. Simple as that.

    • Re: (Score:3)

      by NoZart ( 961808 )

      IANAL, but wouldn't that be illegal in EU?

      • In some ways, yes. (Score:4, Interesting)

        by dutchwhizzman ( 817898 ) on Saturday March 23, 2013 @06:09AM (#43255853)
        By becoming a cartel, it would be illegal. However, if one large provider would publicly announce it would stop doing business with apple and all the others would follow, there isn't much apple could do. If this was staged by the EU telcos and kept secret, apple would have the burden of proof. I think that a lot of EU telephone market movements are done this way, but I have no way of proving it, so it's just an expression of my opinion.

        • Re: (Score:1)

          by Buzer ( 809214 )

          It could still fall under the cartel or similar laws. Recently in Finland there was a case where dairy producer (Valio) had originally cut their milk price to drive another company out (Arla). The Finnish Competition and Consumer Authority was not happy when they found out and more or less forced Valio to up their prices. Valio publicly announced they were going to increase their wholesale prices by 30%. FCCA was angry again, claiming that kind of announcement could be considered to be price signaling and i

          • I think the person you're replying to is taking the "it isn't illegal if you don't get caught" attitude ;)

        • Re: (Score:2)

          by phayes ( 202222 )

          The European telecom market is much too fragmented to be called a single market, it's merely an assembly of national markets. Conditions in one national market have very little to do with those in other markets as the actors are generally very different from country to country.

          Now as for your contention that all that needs to happen is for one important actor in one country to renounce their contract with Apple & for the rest of the operators to domino after, it's bull. Here in France, Freemobile.fr ent

  • Carriers aren't forced to offer Apple. In fact, in Europe you aren't really obliged to do anything about Apple - you can succeed (as mobile provider) other ways. Of course, it is much harded than hoping all kool-aid drinking Apple fanboi masses come to you and you only (if serously, Apple is playing with fire here - my pick huge number of their sales in Europe comes from carriers, because no hipster or "cool kid" can afford retail price of Apple).

    So, unless Apple has near 90% monopoly in smartphone market (

    • Re: (Score:1)

      by Anonymous Coward

      OEMs weren't forced to offer Microsoft. In fact, in US you weren't really obliged to do anything about Microsoft - you could succeed (as OEM) other ways. Of course, it is much harder than hoping all MS using enterprise masses come to you and you only etc. etc. etc.

      You don't need to be a monopoly to engage in anti-competetive practices. With 40-50% of mobile market, Apple certainly has enough mass to swing around, and what they're doing here is not much different from what MS did.

      Hint: it's not about "hoping

  • It's called business ... business operates on contracts... just because you're lousy at negotiating contracts doesn't mean one of your suppliers is anti-competitive unless the contract stipulates you can't sell other manufacturer's phones. Man-up and learn how to do business and stop relying on your "bought-and-paid-for" regulatory agencies to boost your bottom line.

    • Re: (Score:2)

      by EzInKy ( 115248 )

      unless the contract stipulates you can't sell other manufacturer's phones.

      Isn't that the essence of the very problem here? If Apple's contract state you must sell X amount of Apple phones, then isn't that an implicite stipulation that you can not sell phones from other manufacturers unless you can meet X?

      • Isn't that the essence of the very problem here? If Apple's contract state you must sell X amount of Apple phones, then isn't that an implicite stipulation that you can not sell phones from other manufacturers unless you can meet X?

        And if the other manufacturer offers spiffs to your store employees for selling their phone, doesn't that mean they cannot sell iPhones if they want their cash from Samsung?

  • While Apple's terms are different from carrier to carrier, a major complaint from the European carriers is that Apple forces them to sell a certain amount of iPhones over a determined amount of time. If the carrier does not meet this quota, then they must pay Apple for the unsold devices.

    The "compensate Apple" referred to in the summary appears to simply be that they need to pay for the devices they ordered even if they can't re-sell them to consumers. I know that the EU has strong protections for cons

    • If I understand the article correctly, the problem isn't that Apple has an overall minimum - it's that Apple is setting a minimum per carrier and using that to force market share, somewhat similar to the per-CPU licensing that Microsoft did in the 90s.

      Assuming I understand the implications of the article correctly (and it doesn't spell this out), the Apple trick works somewhat like this:

      Carrier X has 100,000 customers, 10,000 of which are super-Apple-fanboys as customers. If they don't get their iPhone, th

  • they followed EU warranty laws?

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