Orange Chief: French IPhone Selling
France's Orange Says IPhone Sales Better Than Expected — PARIS (AP) — Sales in France of the much-hyped Apple Inc. iPhone after the holiday season are going better than mobile carrier Orange expected, Didier Lombard, head of Orange parent France Telecom, said Thursday.
Context & Ripple Effects
Orange entered the French iPhone market through the three-carrier European deal of August 2007, which split Germany, France and the UK between T-Mobile, Orange and O2 — with each operator handing Apple a reported 10 per cent of iPhone user revenue. France then became the test case for a wrinkle the other markets didn't have: French law compelled Apple to allow an officially unlocked version, which Orange has been selling alongside its locked €399 handset.
That legal quirk is the backdrop to today's news. Orange began selling unlocked iPhones in October 2007 (after Apple yielded to the French requirement), priced at €649, though a December report found those 'officially' unlocked handsets weren't fully open (not really unlocked), and an unconfirmed claim circulating then put unlocked units at up to 20 per cent of French iPhone sales. Now France Telecom chief Didier Lombard says post-holiday demand is beating Orange's own forecasts — the first public read on whether the premium-priced unlock model is finding buyers.
First-order effects
- Lombard's statement validates Orange's exclusive French franchise heading into 2008: stronger-than-expected volumes mean more subscription revenue for Orange and a larger 10 per cent revenue stream flowing to Apple under their deal terms.
Second-order effects
- If the unconfirmed figure of roughly one-in-five French iPhones sold unlocked holds, it pressures T-Mobile and O2 to argue for similar unlock terms where their own regulators permit, since every unlocked unit is a subscriber Orange can't lock in — while rivals SFR and Bouygues remain shut out of the device entirely.
Third-order effects
- The French experiment suggests carrier exclusivity is becoming negotiable device by device: where legislation or buyer preference forces open handsets, operators will pay Apple for access anyway, shifting leverage toward the handset maker and making the revenue-share contract, not network lock-in, the real basis of the carrier-Apple bargain.
The trend: European carriers are accepting thinner lock-in on Apple's terms — trading exclusivity plus a 10 per cent revenue cut for iPhone access, with national unlocking rules deciding how open each market gets.