The New York Times back in March reported that a group of unnamed European wireless carriers complained to the European Commission about Apple’s strict volume and marketing commitments in regard to iPhone sales. Today, the Financial Times claims to have seen documents proving that Brussels is moving a probe into iPhone sales tactics to the next stage.
The news couldn’t have come at a worst time for Apple, which earlier this month faced U.S. Senators who grilled CEO Tim Cook along with two other high-ranked executives over Apple’s tax avoidance tricks and refusal to repatriate revenue from sales made overseas…
Carriers in France and elsewhere in Europe are complaining about iPhone volume commitments that increase their exposure with billions paid in upfront subsidy for the handset.
On top of that, Apple is requiring that carriers promote its smartphone heavily and demands it be offered no worse subsidies and sales terms than other smartphone makers.
Responding to these assertions of anti-competitive practices, the European Commission last week sent a questionnaire to several EU mobile network operators.
The Financial Times has more:
The inquiry is spurred by private complaints from mobile operators and remains at a preliminary stage. Before launching a formal abuse probe, the commission will need to be confident that Apple is dominant in the EU smartphone market, a bar that may prove hard to clear given the emergence of Samsung’s popular Galaxy handsets
Apple on its part says its contracts comply with EU laws.
Specifically, in a section on “most favoured supplier clauses”, the Commission asks whether Apple forces operators to grant the iPhone subsidies and sales incentives on “the same or better terms” than all other smartphones.
The Commission wants to know whether this clause still exists in contracts and whether Apple is imposing these terms in “oral or written statements”.
Carriers have until June 17 to return the questionnaire.