German iPhone offered without contract

Deutsche Telekom's T-Mobile will allow customers in Germany to buy Apple's iPhone without having to sign a T-Mobile contract after rival Vodafone obtained a court injunction against it.

T-Mobile said on Wednesday it will offer the iPhone without a T-Mobile contract for €997 (£716) at its shops.

It will also allow those customers who bought an iPhone since 19 November to unlock the device free of charge so it can be used with other SIM cards. However, that will not enable customers to make use of all the functions that the music-playing and Web-browsing device offers.

T-Mobile has an exclusive deal with Apple to sell the iPhone in Germany, where Apple has no stores. Until now, customers had to sign up to a 24-month T-Mobile contract costing a minimum of €1,173 (£843) in order to buy the phone for €398 (£286).

A German court granted Vodafone a preliminary injunction this week preventing T-Mobile from locking the iPhone's SIM card to T-Mobile when making a sale.

T-Mobile said it will comply with the injunction until the situation has been clarified by a court.

Vodafone had hoped to win exclusive rights to sell the iPhone in Europe but lost out to T-Mobile in Germany, Telefonica's O2 in Britain and France Telecom's Orange in France.

In Britain the iPhone costs £269 on top of an 18-month contract costing a minimum of £35 per month. It will go on sale in France at the end of the month.

German mobile phone operator Debitel has also lodged a complaint with Germany's telecommunications regulator about T-Mobile's iPhone deal, arguing it was not acceptable to link the use of the iPhone exclusively to T-Mobile's network.

A spokesman for the federal network agency said it had asked T-Mobile to respond but declined to give details.

Story Copyright © 2007 Reuters Limited. All rights reserved.