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Australian iPhone deal could prove illegal

updated 04:35 pm EST, Mon February 25, 2008

AU iPhone deal illegal?

Apple's planned release of the iPhone in Australia could turn out to be an illegal affair under current trade laws, according to one group of law researchers. iPhone launches are expected tot ake place in Asia as well as Australia some time during 2008, but an exclusive deal with one mobile carrier could restrict customer choice in technology markets, according to law researcher Dale Clapperton as cited by theage.com.au. Both France and Germany have both enacted measures to ensure iPhone customers in those countries can choose a carrier other than Apple's chosen partner, to protect consumer choice as well as competition.

"The iPhone is breaking new ground in using technology to restrict customer's choice in technology markets," said Queensland University of Technology (QUT) law researcher Dale Clapperton.

An analysis of iPhone under Australia's competition laws by Clapperton and fellow QUT law expert Professor Stephen Corones revealed the possibility of legal difficulties.

"This law will greatly simplify the task of seeking redress for such behaviour through the courts and could prove a deterrent for exclusive release of the iPhone with one carrier," said Clapperton. "If Apple [enters] into an exclusive agreement with any particular carrier then it would be a matter for the ACCC (Australian Competition and Consumer Commission) as to whether that agreement was anticompetitive and contravened the trade practices act."

"It would be like Ford deciding that from now on all of the cars they produce can only use be used with petrol from Shell," he explained. "If you fill your car up with fuel from BP the ignition system will detect that and shut down the car."

Clapperton said he would prefer Apple release an unlocked iPhone in Australia, but admits that possibility is unlikely based on previously-signed deals.




by MacNN Staff

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Comments

  1. Guest

    Joined: Dec 1969

    0

    the deals

    as far as I can tell the exclusive deals ate based on visual voicemail network modifications and kick backs to Apple.

    Apple wants the exclusive deals to maintain the kick backs

    The carriers want the exclusive deals to maintain customer growth to cover costs of implementing visual voicemail.

    If you raise the price of the phone then Apple might drop its kick back but the carriers still want to ensure customer growth on their networks to cover the extra cost if hardware upgrades for visual voicemail.

  1. christhechris

    Joined: Dec 1969

    0

    that seems unlikely

    There are at least 3 Australian carriers I can think of that have phones which are exclusively sold on there network. This guy just wanted to make the news...

  1. MeandmyMac

    Joined: Dec 1969

    0

    Another way to look at it

    "This law will greatly simplify the task of seeking redress for such behaviour through the courts and could prove a deterrent for exclusive release of the iPhone with one carrier," said Clapperton. "If Apple [enters] into an exclusive agreement with any particular carrier then it would be a matter for the ACCC (Australian Competition and Consumer Commission) as to whether that agreement was anticompetitive and contravened the trade practices act."

    "It would be like Ford deciding that from now on all of the cars they produce can only use be used with petrol from Shell," he explained. "If you fill your car up with fuel from BP the ignition system will detect that and shut down the car."

    Weak analogy... That's like saying one mobile carrier's gsm phone cannot use the cell signals that another competitor sends out for their gsm phone use or else the carrier will detect that you are using their signals and your cell phone will drop the call. When there are plenty of instances of carriers having agreements with competitors saying where our coverage signal is weak to lack of coverage and your coverage is strong you'll allow our customers to use the cell signals and conversely you'll do the same for us on your network.

    Another way to look at it...

    Are there new car showrooms in Australia that only sell the name brand product of that new car showroom? That is, are there Ford dealerships in Australia? If so, do they only sell new Ford manufactured cars and trucks? Why can't that Ford dealership sell NEW Chevrolet or NEW Toyota cars and trucks at that Ford dealership should a customer want one?

    After all just replace Apple w/ Ford, carrier w/dealership and iPhone w/ New Cars & Trucks and you get...

    "This law will greatly simplify the task of seeking redress for such behaviour through the courts and could prove a deterrent for exclusive release of the New Cars & Trucks with one dealership," said Clapperton. "If Ford [enters] into an exclusive agreement with any particular dealership then it would be a matter for the ACCC (Australian Competition and Consumer Commission) as to whether that agreement was anticompetitive and contravened the trade practices act."

    So why is it that Ford manufacturer can have an exclusive agreement with a Ford New Car Dealership in Australia to sell only Ford manufactured New cars and trucks? Why can't I get my New Toyota car or truck at that same dealership?

    Can someone please tell me how that would be different in the eyes of the ACCC (Australian Competition and Consumer Commission) as to whether that agreement was anticompetitive and contravened the trade practices act." If Ford enters into a contract to exclusively release new Ford cars and trucks for that dealership to sell on their showroom floor New Fords. Why can't Apple be Ford, iPhone be New Cars and Trucks and mobile carriers be new dealerships???

  1. mr.mouse

    Joined: Dec 1969

    0

    Analogies

    meandmymac, the original Analogy involving petrol holds. It is not a matter of who sells the iPhone, but a matter of who's network it can be used on after sale. There is no problem with the iPhone only being available in one shop, it's the fact that the owner of the phone is then forced to use a single GSM supplier, who can then dictate costs for using that GSM network.

    So to return to the petrol analogy, if you can only use Shell in your Ford, and Shell is not as widely available as BP and costs A$0.5 per litre more then it's locking you in to a premium product for no other reason than to make more money out of you. It is anti-competitive.

    As for the comment christhechris, there may be phones that can only be bought from one GSM telco as part of a contract, but the question is can you buy that phone directly from the phone manufacturer and still use it on any GSM network? I suspect you can (it's the case for Nokia, SE, HTC and probably more). Don't confuse subsidised phones being available on a particular carrier, with carrier exclusivity (a la iPhone). They are different. The iPhone is not even subsidised and you're still tied in, locked down and controlled. It's outrageous!

  1. docsharp76

    Joined: Dec 1969

    0

    Australian iPhone

    Great blog with lots of useful information and excellent commentary! Thanks for sharing.

    http://www.1-satellite-tv-facts.com/Direct-TV.html
    http://www.1-satellite-tv-facts.com/Dish-Network.html
    http://www.1-satellite-tv-facts.com/Satellite-Radio.html
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    http://www.1-satellite-tv-facts.com/Satellite-Internet.html
    http://www.1-satellite-tv-facts.com/VoIP.html
    http://www.1-satellite-tv-facts.com/Phone-Systems.html
    http://www.1-satellite-tv-facts.com/Affiliate-Programs.html

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