Why Apple’s iPad and iPhone distribution faces EU antitrust scrutiny

“Apple Inc. (AAPL)’s distribution practices for iPhones and iPad tablets are being examined by European Union antitrust regulators who said they’ll act if they see any behavior harmful to customers,” Aoife White reports for Bloomberg.

“The European Commission is ‘currently looking at this situation and, more generally, is actively monitoring market developments,’ Antoine Colombani, a spokesman for the Brussels-based authority, said in an e-mail,” White reports. “While regulators were ‘made aware’ of Apple’s distribution methods, they haven’t received any formal complaints, he said. ‘We will intervene if there are indications of anticompetitive behavior to the detriment of consumers,’ Colombani said.”

“everal phone carriers sent the EU information on their distribution contracts with Apple to check whether any terms restricted competition, the New York Times reported today, citing a person briefed on the situation,” White reports. “While the EU is focusing its inquiries on French phone operators, others elsewhere in Europe may also be involved, the newspaper said.”

White reports, “Cupertino, California-based Apple’s contracts ‘fully comply with local laws wherever we do business, including in the EU,’ said Alan Hely, a spokesman for the company in London.”

Read more in the full article here.

“The focus is on the commitments carriers must make if they want to carry the iPhone,” Philip Elmer-DeWitt reports for Fortune.

“In an SEC report filed last month, Leap Wireless (LEAP) disclosed that it had signed a contract with Apple in May 2012 in which the carrier, in exchange for the right to sell the iPhone, agreed to buy $800 million worth of the devices over the next three years,” P.E.D. reports. “As it turned out, it was a bad deal for Leap, which was selling iPhones in the U.S. on a novel, pay-as-you-go basis. With five months left in its first year commitment Leap was going to have — by one analyst’s estimate — about 160,000 unsold iPhones on its hands.
The European Union doesn’t care about Leap, a U.S. company based in San Diego. But it is concerned about the kind of the deal it struck with Apple.

P.E.D. reports, “According to a report in Friday’s New York Times, European regulators are examining similar contracts that Apple signed with European cellphone carriers for possible antitrust violations.”

Read more in the full article here.

Related article:
EU antitrust regulators monitoring distribution of Apple’s iPhone, iPad – March 22, 2013


  1. Where was Apple’s legal team? Oh, yeah, they were focused on suing Samsung for patent violations instead of prospectively reviewing EU rules and regulations.

    1. Whoa everybody. Before you get all excited about this, you should know more about EU anti-trust laws.

      First, and foremost, the alleged violator must have a dominant, monopoly type market share, and then it must violate the EU’s laws defining abuse of said monopoly.

      The dominant (marketshare viewpoint) manufacturer in the EU is Samsung. It pretty much doesn’t matter what Apple’s conduct is while Samsung has a greater market share.

      If Apple’s conduct is borderline, the EU commission may make a statement to that effect, but thats it.

      Its a very long trip from “looking into it” and a conviction. There is nothing to get in a twist here.

  2. The f***tards in Europe are at it again.

    How can anyone possibly render the world’s best customer service company into an activity that is harmful to customers?

    I suppose in France throwing a plate in your face in a restaurant is acceptable and in Germany chucking a pint glass at your head in a beer hall is deemed acceptable service which explains why the f***tard Euros don’t get the meaning of top notch service.

    1. They must have gotten another check from Samsung so they are jumping into it now to try to slow Apple and the iOS devices down. At least long enough to get a few more checks from Samsung.

  3. Oh and before I forget serving warm beer in pubs in Britain is how they drink it over there.

    And Spaniards prefer taking a siesta and sleeping on the job rather than giving service between 12 and 4 in the afternoon.

    Have I left out any f***tard Euros?

    1. What? I live in England and there is no such thing as a warm pint. Every line of beer has an extra chilling pump. Donyou what too much TV? Stop offending us. Did you know that your US washing machine takes half the time of a European standard machine? Wanna know why you save half the time? Because your US machines use 4 times as much water. The world would be a much better place without you Americans.


      1. Don’t pay any attention to Balmers left nut. He’s a little off his nut. I’m glad your pint is chilled. I’m not sure about the washing machine issue, we however like our clothes clean. But then of course, we take showers at least once a day also. And brush our teeth several times a day. And our teeth look nice. Very nice. We being Americans. Citizens of the good old USA. Sorry you don’t have any use for us. That’s a shame. Most Americans feel an affinity for our British cousins. But I understand your inferiority complex. You’re still smarting over the several times that we kicked your limey fucking asses several hundred years ago. And the fact that we had to bail you out of two wars against the Germans. Especially WW2. But get over it. We have. You don’t owe us a thing. Besides, even if you did decide to pay us for all that you owe us financially from two wars we only deal in greenbacks. Pound is what the Germans were about to do to you until we saved your dumb asses! So remember that the next time you look around at all that surrounds your little island. You don’t have any friends there. And you certainly don’t have an empire anymore. And your economy not to mention your socialist state is in the toilet. So I’d be careful about what I say concerning the only country in the world that will bill your asses out of a jam again. And I’m proud to be an American. USA! USA! USA!

    2. My buddy, who nowadays has his own microbrewery US, was a quite a beer connoisseur in his youth. He once made us taste beers in different temperatures and oh boy. You almost couldn’t drink typical American beer when it was warm. The “taste” was in the bubbles, and you cant taste that much when something is cold (even it warms up in your mouth), the soda pop beer has to be cold.

      Some years later people started noticing the scam the big breweries were pulling and in the end the microbreweries saved the day.

      I think those “lawnmover beers” are still in the market, good for cooling you off after moving the lawn, no need to drink some sugar water.

    3. BLN at times you are the quintessential bourgeois philistine.

      Beer in the pub

      Keg beer is simply connected to a cylinder of gas and served. Real ale is a very different matter.

      When the beer arrives at the pub it needs to undergo its secondary fermentation before it can be served. The usual practice is for the casks to be placed in a cool deep cellar.

      Some pubs keep their beer in a special cool room on the ground floor, a few keep their beer behind the bar – preferably nowadays with some modest external cooling system. Real ale is served at cellar temperature 12-14 C (54-57 F), which is somewhat cooler than room temperature. If real ale is too warm it is not appetizing, it loses its natural conditioning (the liveliness of the beer due to the dissolved carbon dioxide).

      On the other hand if the beer is too cold it will kill off the subtle flavour. Unlike keg beer which has to be chilled, real ale has flavours you need to taste! Real ale is not ‘warm’, ‘cloudy’ or ‘flat’. Real ale is served below room temperature, like red wine; served properly it should be entirely clear; if it kept and served properly it will have enough natural life to be appetizing.

      How long a beer needs to stand depends on the beer, particularly its alcoholic strength and how vigorously it ferments. Some modern beers have a weak fermentation and may clear within twenty four hours. That does not mean that these beers have conditioned sufficiently and to serve them as soon as they are clear is not necessarily to serve them at their best.

      The cask is wedged on its side, to encourage the sediment to sink into the belly. Every cask has two plugs where instruments can be knocked into the cask by force. The cellar person knocks a small wooden peg into one. A hard wood peg seals the cask, a soft wood peg allows carbon dioxide to escape. By alternating hard and soft pegs as needed, the cellar person carefully controls the natural carbonation of the beer. Too high a carbonation and the beer will have a nasty bite, too little and the beer will be flat.

      When the fermentation is about right, a tap is knocked into the cask at the other entry point. The cellar person will check that the beer is clear, has the right level of carbonation, and has lost the unpleasant flavours associated with beer that is too young. When the beer is ready to serve, the tap is connected to the dispense system. How long the beer lasts depends on its strength – stronger beers are more robust, and may last for weeks, weaker beers are normally drunk within a few days. This is why turnover is so important for quality – ideally the pub sells enough beer that you always drink it at its best.

      Serving real ale –
      The most common means of dispensing real ale is the beer engine – a tall handpump on the bar, which operates a simple suction pump. When the handle is pulled a half pint is drawn into the glass.

      Sometimes in the Midlands and North an electric pump is used. This simply uses a machine to do the same work as the handpump in drawing beer to the bar. In appearance electric pumps can be confused with the dispensers used for keg beer. Real ale can of course be poured straight out of a cask behind the bar, often called gravity dispense.

      Finally, in Scotland, a tall fount is used. This drives beer to the bar with air pressure. There is one final point about the beer’s journey to the glass. Serving beer through any handpump agitates the beer to some extent and aerates it.

      Some dispense systems deliberately maximise this agitation. A sparkler is a tight nozzle, normally at the end of a long ‘swan-neck’ tube. Beer must be forced through the tight holes, often requiring several strokes of the handpump. This agitation produces a thick creamy head; it also removes much of the natural carbonation from the body of the beer, and drives much of the hop bitterness into the head of the pint.

      Such dispense is traditional in some parts of the North, and beers are brewed there with this in mind. Used on other beers it leads to a different flavour balance to that intended by the brewer – the beer may become blander than the brewer wanted.

      No gas needed –
      There are systems which dispense cask conditioned beer by gas pressure. Other systems store cask beer under gas so as to prolong the shelf-life. CAMRA disapproves of both systems and actively discourages their use. The first makes beer unpleasantly fizzy, the second interferes with the maturation processes of the beer. Such gas systems are not needed in a well run pub.

      From http://www.camra.org.uk
      Campaign for Real Ale

  4. Well that’s pretty alarming guys. Almost $1 billion in iPhone purchases required? Who the hell is Leap anyway? I agree with the EU. Apple could be forcing carriers to spend too much on the iPhone, thereby stymying competition.

    I love Apple but you guys are just delusional. The trch industry needs regulation.

  5. It’s business! You don’t have to be nice. You don’t have to make friends. As long as it’s legal, that’s all that matters. Eventually someone may replace you, but until then get all you can get. Apple is no different than any other company out to make money. That’s their job. It’s why they go to work. If it wasn’t it would be a hobby. Yes they love making great things. And they do just that. The very best. But so do lots and lots of other companies. You just need to get away from consumer electronics and you’ll see that that’s true. There are great companies with great products in all sectors. And they all have one thing in common. Profit. No profit, no product. It’s as simple as that. And no, it doesn’t have anything to do with the vision of the company or its leaders. Part of Apple makes great stuff and part of Apple sells the great stuff. They don’t do each other’s jobs and that’s why it works so well. It’s not obscene to make a profit. You need to have great products to sell to make a profit so you can make more great products. They do coexist. And Apple does it magnificently. I don’t what all the fuss is about? Is there any validity to this or not? You can be certain that we’ll soon see.

    1. You’re right with that…

      Don’t want it don’t buy it, but this could partially explain why so many carriers promote other brands…

      It’s not so much that they get “paid” by other companies (Like some here like to say) to sell their phone but more that they don’t want to pay Apple’s fee.

      Apple is no longer a monopolistic phone maker. They must fight with competition (Also in the high en market). They should adapt their strategy to that.

      What actually helps Apple a lot is the massive fan base and the image of luxury object they (still) have.

      The fanbase will probably never dissapear but if Apple’s public image changes too much for the masses, the situation in new Markets (China / India), where status symbols are important, could become tricky.

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