EU weighs iPhone sale deals

Although they have not filed formal complaints,a group of European wireless carriers recently submitted information about their contracts with Apple to the European Commission,according to a person briefed on the communications with the carriers who asked not to be identified.

This person said the accusations focused on Apple’s contracts with French carriers,though other countries may also be involved.

In a statement,the European Commission,the union’s administrative arm,which oversees antitrust enforcement in the 27-nation bloc,confirmed it was examining Apple’s carrier deals. But it said it had not begun a formal antitrust investigation. The commission is not obligated to act until it receives a formal complaint of anticompetitive behaviour. That it is already examining the contracts suggests that it is taking the carriers’ concerns seriously.

“We have been contacted by industry participants and we are monitoring the situation,but no antitrust case has been opened,” said Antoine Colombani,a spokesman for Joaquín Almunia,competition commissioner of the EU.

An Apple spokeswoman,Natalie Kerris,said,“Our contracts fully comply with local laws wherever we do business,including the EU.”

It was unclear how many carriers were in discussions with the EU. Based on interviews with people briefed on iPhone contracts,it appears that Apple’s contracts with some smaller European carriers were stricter than those with larger companies.

People briefed on the carriers’ relationships with Apple,who declined to be named because Apple does not permit them to speak about the contracts,said the terms that some European carriers must accept to sell iPhones are unusually strict,making it difficult for other handset makers to compete.

The issues do not appear to apply to carriers in the US; an executive at an American carrier said the terms of its contract with Apple were aggressive but not unreasonable. Apple is well known for controlling the design of its products,down to the smallest detail,and closely controlling its manufacturing. Its relationship with carriers,long cloaked by strict nondisclosure pacts,offers a window into the similar levels of control Apple exerts on business partners who want to sell the iPhone.

While European carriers quietly grumble about Apple’s muscle in the marketplace,Apple does not force any of them to sell the iPhone — it does not need to. Carriers are petrified at the thought of not having the smartphone because it remains a huge hit with the public.