Vodafone Protests T-Mobile iPhone Sales

T-Mobile continued to sell Apple's iPhone in Germany on Tuesday, despite a legal challenge filed on Monday by rival Vodafone.

Vodafone charges that the sale of an unsubsidized, locked handset with a 24-month contract violates German competition law, said Simon Gordon, a Vodafone spokesman in the U.K.

On Monday, a court in Hamburg granted a temporary injunction against T-Mobile, although the terms of that order do not stop the operator from selling the iPhone, said representatives for Vodafone and T-Mobile.

European mobile phone operators typically subsidize the cost of handsets for customers who sign long-term contracts, but the handsets are locked and won't work on other networks. Some countries regulate such behavior. Customers can also pay full price for unlocked phones that will work with any network.

T-Mobile refutes the accusation that its iPhone sales violate German law.

"We have an exclusive device in our portfolio, but if you look at the market, that's normal," said a T-Mobile spokesman in Germany. "The main thing is we will sell the iPhone. There is no stop to selling the iPhone."

Another court hearing will be held in about two weeks, although a date has not been scheduled.

Vodafone did not ask the court to stop T-Mobile from selling the iPhone, Gordon said. Vodafone would like to see a court eventually mandate that T-Mobile sell an unlocked version of the iPhone for the same or less as today's locked version, he said.

T-Mobile said it sold about 15,000 iPhones on Nov. 9, the day it launched in Germany, but has not released figures for sales since then. The 8G-byte iPhone sells for ,399 (US$589) including 19 percent value-added tax. The price in the U.S. is $399 excluding sales tax.

Apple's tight control of the iPhone and the locking of the device to the networks of its chosen operators hasn't gone down well with users, either.

Hackers have succeeded in modifying the firmware to let the iPhone run on other networks, but Apple has invalidated the hacks in successive updates of the phone's software.

In France, Apple's partner Orange plans to release an unlocked version this month to comply with a law there that forbids tying a cell phone to a specific operator. The iPhone is due to go on sale in France Nov. 29.

In its October earnings conference call, Apple estimated that some 18 percent of the iPhones sold by then, or about 250,000 of them, had been unlocked to run on networks other than that of its its U.S. partner AT&T.