French newspaper Les Echos is reporting that Orange France is looking at the possibility of not launching the iPhone before Christmas. Negotiations between Apple and Orange are described as tense and close to the breaking point.
On the Apple side, a French law that phones can be sold both with and without a service contract is not sitting well. This jeopardizes their cut of the service contracts sold with the phones (that they have negotiated with other carriers). Meanwhile, Orange is concerned with Apple’s (in)ability to keep the iPhone locked to prevent people from buying the iPhone and using it with another carrier. Orange estimates that there are already several thousand unlocked iPhones in use in Europe.
For Orange, at risk is the ability to capitalize on the popularity of the iPhone in France and gain new customers (including from its competitors). For Apple, expected sales of some 100,000 French iPhones could be in jeopardy.
It will be interesting to see who blinks first…