T-Mobile says to sell iPhone without contract

A model presents an Apple iPhone at the T-Mobile Store in Cologne November 9, 2007. Deutsche Telekom's T-Mobile will allow customers in Germany to buy Apple's iPhone without having to sign a T-Mobile contract after rival Vodafone obtained a court injunction against it.

FRANKFURT (Reuters) - Deutsche Telekom's (DTEGn.DE) T-Mobile will allow customers in Germany to buy Apple's (AAPL.O) iPhone without having to sign a T-Mobile contract after rival Vodafone (VOD.L) obtained a court injunction against it.

T-Mobile said on Wednesday it will offer the iPhone without a T-Mobile contract for 999 euros ($1,478) at its shops.

It will also allow those customers who bought an iPhone since November 19 to unlock the device free of charge so it can be used with other SIM cards. However, that will not enable customers to make use of all the functions that the music-playing and Web-browsing device offers.

T-Mobile has an exclusive deal with Apple to sell the iPhone in Germany, where Apple has no stores. Until now, customers had to sign up to a 24-month T-Mobile contract costing a minimum of 1,176 euros in order to buy the 399-euro phone.

A German court granted Vodafone a preliminary injunction this week preventing T-Mobile from locking the iPhone's SIM card to T-Mobile when making a sale.

T-Mobile said it will comply with the injunction until the situation has been clarified by a court.

Vodafone had hoped to win exclusive rights to sell the iPhone in Europe but lost out to T-Mobile in Germany, Telefonica's (TEF.MC) O2 in Britain and France Telecom's (FTE.PA) Orange in France.

In Britain the iPhone costs 269 pounds ($555) on top of an 18-month contract costing a minimum of 35 pounds per month. It will go on sale in France at the end of the month.

German mobile phone operator Debitel has also lodged a complaint with Germany's telecoms regulator about T-Mobile's iPhone deal arguing it was not acceptable to link the use of the iPhone exclusively to T-Mobile's network.

A spokesman for the federal network agency said it had asked T-Mobile to respond but declined to give details.

(Reporting by Mantik Kusjanto and Nicola Leske; editing by Paul Bolding)