Apple Gets Slapped With US$667,000 Fine In Taiwan For 'Fixing' iPhone Pricing
Apple is accused of interfering in the pricing and mobile phone payment rates of three local telcos for iPhones, despite selling them the distribution rights.
By Sadho Ram — 27 Dec 2013, 05:33 PM — Updated over 10 years ago
Apple has been fined US$667,000 by the Taiwan Fair Trade Commission for trying to influence iPhone prices in the country
Apple’s attempts to sell the iPhone at a premium price around the world has landed the company in trouble as Taiwan’s Fair Trade Commission, or FTC, has fined the company for allegedly dictating the smartphone’s pricing to the country’s telecom companies.
zdnet.com
FTC said on Wednesday that it had slapped Apple with a $670,000 fine for interfering with the iPhone's pricing plans at Taiwan’s mobile-service providers and handset distributors.
Local telcos Chunghwa Telecom, Far Eastone Telecommunication and Taiwan Mobile had submitted their pricing plans to Apple for approval or confirmation before launch
The U.S. tech giant had reportedly also asked the carriers to adjust their prices.
macobserver.com
“Apple deprived the telecom operators of liberty to decide on the prices based on their own cost structures and competitive market situation, to restrict competition ... and violate the fair trade law,” the commission said in a statement, urging Apple to immediately stop its illegal actions.
zdnet.comNormal practice is that a company like Apple negotiates distribution rights with carriers ahead of selling on their networks, and then the carriers have the right to sell at whatever price they want after paying Apple the agreed upon fees.
Basically, Apple has no right to interfere with companies' iPhone pricing plans after selling them distribution rights
Although Apple can appeal against the fine, it could face a fine of up to $1.6 million if it does not meet the terms
Either fine is unlikely to have much of an effect on Apple's bottom line. The iPhone and iPad maker reported revenues of $37.5 billion and net profit of $7.5 billion on Oct. 28 for its fiscal fourth quarter. Apple sold a record 33.8 million iPhones during the period.
eweek.com
Despite stiff competition from Samsung and other Android handset makers, Apple is poised to set more records. The company announced on Dec. 22 that its iPhone 5S and 5C handsets will finally go on sale through China Mobile, the world's largest cellular provider with 760 million subscribers, in Jan. 2014.