France Shaping Up To Be The Most Interesting iPhone Market

D-1 for iPhone Europe day (or I guess T-4 hours if you’re in Cologne), and a line of at least two people has formed outside the Apple store on Regent Street in London. I’m very curious to see how the iPhone fares in Europe. I’m sure the first few days will be filled with frenzied sales, but I have my doubts that momentum will continue for too long. A lack of 3G, the strength of existing handset brands (particularly in relation to the US), and the widespread availability of better spec’ed handsets at much lower costs should hold things down.

I’m especially interested to see what happens in France, where the iPhone doesn’t go on sale until November 29. The iPhones sold there will be unlocked (thanks to French law), threatening Orange’s “exclusive” and Apple’s revenue-sharing business model. But it sounds as if Apple’s going to fight that, according to Dow Jones:

Once the phones go on sale officially in France on Nov. 29, customers will be able to buy them for EUR399 locked to an Orange contract, or for a higher, yet to be specified, price unlocked and without a contract. France is the only country where unlocked phones will be sold, providing a fresh source for those wishing to sell them on.

Customers who put SIM cards from Orange’s rivals into an unlocked iPhone run the risk of not being able to use all of its features, including the iTunes music player.

The lower price with the contract should help some, but I wonder what features non-Orange phones will be unable to access. Obviously there’s the operator-dependent Visual Voicemail feature, but locking users out of the music player would ruffle more than a few feathers. I’m certainly no expert on French consumer law (and if you are, please leave a comment on this point), and I wonder if such restrictions would fall foul of the anti-locking rules.

Other operators in France are also firing back with new offerings and tariffs, making me wonder if people who are interested in the iPhone for use on a network other than Orange might simply decide it’s too much hassle, and too expensive — since, for instance, SFR will subsidise a Nokia N95 down to 99 euros.

How long before a non-iPhone operator starts offering free iPods to entice subscribers? I wonder how successful that would be in comparison to what the likes of AT&T, O2, T-Mobile and Orange are giving up to get the iPhone.

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