Apple and Orange to Partner in France for iPhone Distribution

In a joint announcement today, Apple and Orange, the leading wireless carrier in France announced Orange would have exclusive rights to sell the iPhone in France. iPhone, the new phone from Apple has been a huge success ever since its launch, and will enter the French market for the first time on November 29.

The iPhone has met with spectacular success right from its debut in the United States on June 29. Offering multiple services such as a phone connection, a music player, and also Internet browsing facilities on a single platform, the iPhone’s popularity has soared to new heights with each passing day.

Apple CEO Steve Jobs said in the joint statement his company was pleased to have Orange as its partner for their French venture. He said together, the two would be able to make the iPhone available to the people of France before the holiday season started. Calling the iPhone an ‘amazing product’, Jobs said his wish was the French people would like it as much as the Americans have so far.

Through Orange, users would also be able to access the iTunes Wi-Fi Music Store along with the iPhone. Orange, which is a part of France Telecom, has a huge base in France and is the industry leader in the wireless domain in France, with a strong base of 163 million customers.

Orange CEO Didier Lombard expressed satisfaction with the tie-up with Apple. With Apple as well as Orange being global brands and sharing similar values, such as simplicity and innovation, the partnership with Apple was but the natural thing to do, he said. He said the timing of the partnership made it the best gift Orange could give its customers.

The terms agreed upon for the distribution of the iPhone in France would probably not be the same as the terms arrived at with providers in the U.S., U.K., and also Germany. The company has signed a deal with AT&T in the US, O2 in the U.K., and T-Mobile in Germany for distribution of the phones.

The release of the iPhone into the French market was originally scheduled for September, at the same time Jobs went to Europe to finalize the deals with T-Mobile and O2. Apple has had to face a delay in striking a deal with Orange and releasing the iPhone in France because of a consumer law there that insists mobile operators must sell handsets that do not have contractual obligations with them.

If the consumer law were to be applied, as it should be, considering it is a country’s consumer law, Apple may end up not getting revenue shares on any iPhone sales that does not have an Orange contract.

Due to the existence of the French consumer law, Apple has had to rethink the numbers for the pricing of the phone. Accordingly, the company would sell an iPhone in France for €399, considering the company had a contractual arrangement with Orange.

However, if there was no contractual understanding with Orange, as may be the case given the consumer law, Apple would not have an exclusive revenue sharing agreement with Orange for those phones without a contract, a scenario totally different from the ones Apple has going in the US, UK and Germany. The pricing is also likely to go up for such phones.