Apple faces $55M antitrust lawsuit in France over aggressive mobile carrier contracts
A French antitrust body this week filed suit against Apple for allegedly forcing regional wireless carriers into "unbalanced" contracts, a violation of consumer laws that could see the company pay out 48.5 million euros (about $55.3 million) in damages and fines.
According to a complaint filed by the Directorate General for Competition, Consumption and Fraud (DGCCRF) in the Commercial Court of Paris, Apple violated French consumer law by demanding carriers stump for iPhone advertisement, repair and development in return for sales privileges, reports local publication BFM Business.
Further, the DGCCRF calls for the cancellation of ten offending clauses outlined in Apple's mobile provider sales agreements, including stipulations regarding device order minimums, pricing restrictions and open access to a brand's trademarks and patents, among other terms and conditions. The suit has roots in a 2013 French investigation into partnerships between smartphone OEMs and wireless providers.
If the DGCCRF successfully argues its case, Apple will have to pay 14 million euros to SFR, 11.6 million euros to Orange, 6.7 million euros to Bouygues Telecom and 8.2 million euros to Free. An additional 8 million euros are earmarked for fines.
France is not the first country to seek redress over Apple's aggressive contracts. With a hot-selling product like iPhone, Apple is able to broker extremely beneficial contract terms with carriers keen on leveraging the device to boost subscriber numbers. The company's dealings in France are nearly identical to those in other locales, including the U.S., though some nations view Apple's heavy-handed dealings illicit. For example, the European Union launched an antitrust investigation into iPhone sales conditions in 2013, while Canadian regulators brought charges against Apple over similar issues in 2014.
Most recently, Taiwan's Fair Trade Commission last June saddled Apple with a $670,000 fine for forcing regional carriers to seek permission before modifying iPhone price plans and offering subsidies.
According to a complaint filed by the Directorate General for Competition, Consumption and Fraud (DGCCRF) in the Commercial Court of Paris, Apple violated French consumer law by demanding carriers stump for iPhone advertisement, repair and development in return for sales privileges, reports local publication BFM Business.
Further, the DGCCRF calls for the cancellation of ten offending clauses outlined in Apple's mobile provider sales agreements, including stipulations regarding device order minimums, pricing restrictions and open access to a brand's trademarks and patents, among other terms and conditions. The suit has roots in a 2013 French investigation into partnerships between smartphone OEMs and wireless providers.
If the DGCCRF successfully argues its case, Apple will have to pay 14 million euros to SFR, 11.6 million euros to Orange, 6.7 million euros to Bouygues Telecom and 8.2 million euros to Free. An additional 8 million euros are earmarked for fines.
France is not the first country to seek redress over Apple's aggressive contracts. With a hot-selling product like iPhone, Apple is able to broker extremely beneficial contract terms with carriers keen on leveraging the device to boost subscriber numbers. The company's dealings in France are nearly identical to those in other locales, including the U.S., though some nations view Apple's heavy-handed dealings illicit. For example, the European Union launched an antitrust investigation into iPhone sales conditions in 2013, while Canadian regulators brought charges against Apple over similar issues in 2014.
Most recently, Taiwan's Fair Trade Commission last June saddled Apple with a $670,000 fine for forcing regional carriers to seek permission before modifying iPhone price plans and offering subsidies.
Comments
What's the point in signing binding contracts, if corrupt govt agencies and extortionists can come along and complain that they're unfair after the fact?
I am glad that Apple has such strong leverage with the carriers. It's been vital to the iPhone's success.
If any carrier doesn't like it, then don't sell iPhones. Nobody forced them to make any deals.
If Apple weren't as strong handed as they are with carriers, then I guarantee you that iPhones would be very different today.
If Apple were as weak as every other phone manufacturer, then iPhones today would be very different.
My iPhone would have a really ugly AT&T or Verizon or Sprint logo somewhere on the hardware, totally ruining the look. On the software side, there would be crap carrier bloatware on the phone, and we might even have to rely on the carriers pushing out updates, instead of getting it directly from Apple. And we all know how well that's worked out for Android. A complete disaster, iow.
The carriers are not on the side of customers, and hopefully Apple will get their top lawyers on this case and push back against the French extortionists, win the case, and humiliate the fools.