Apple under European investigation over iPhone, iPad sales tactics and 4G restrictions

Europe is quizzing mobile operators about Apple's distribution methods for its mobile hardware.
Written by Liam Tung, Contributing Writer

The European Commission is pressing ahead with an investigation into whether Apple's sales contracts with carriers are unfairly keeping rivals out of the European market.

"The Commission has received information from industry players concerning Apple's distribution practices for iPhones. We are currently examining the situation. This does not prejudge the Commission's position on the issues raised," the EC said in a statement today.

The EC sent out a nine-page questionnaire to several operators last week, asking whether Apple had locked in arrangements with the carriers that prevent smartphone rivals from securing better sales deals, according to documents seen by the Financial Times.

The survey asks whether Apple imposes restrictions on carriers, such as minimum orders, preferential marketing support, and guarantees that its hardware has the best subsidies.

"The Commission has information indicating that Apple and Mobile Network Operators ("MNOs") have concluded distribution agreements which may potentially lead to the foreclosure of other smartphone manufacturers from the markets," the questionnaire states, according to the FT.

The questionnaire follows an informal complaint made to the Commission about Apple's distribution tactics. The Commission has not launched a formal investigation but in March said it was "monitoring the situation" around Apple's distribution of iPhones and iPads.

It noted that Samsung's growing market share and the rise of Android indicated competition is strong in the smartphones and tablet markets, however, it said it would intervene if there were any signs of anticompetitive behaviour that harmed consumers.

Besides Apple's sales deals, the technical measures it uses to enable 4G support for the iPhone 5 and latest iPad on different networks is also under scrutiny.

The questionnaire states there are "indications that certain technical functions are disable on certain Apple products in certain countries in the EU/EEA", which might violate antitrust law if it were confirmed.

One of the most recent carriers it has added support for was Tele2 in Sweden. However, it is only enabled where Tele2 uses the 1800MHz band for its LTE network.

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