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T-Mobile has an exclusive deal with Apple to sell the iPhone in Germany, but was ordered by a court to offer customers the option of an unlocked device.

It agreed to do so, but at a price of 999 Euros, compared with 399 Euros for an iPhone locked into a T-Mobile contract.

Debitel says it will be offering iPhone contracts starting at 40 Euros per month, which is cheaper than T-Mobile's 49 Euro minimum, and will include up to 200 calling minutes or 200 SMS text messages.

It claims customers using Vodafone, E-Plus and O2 networks will still receive all the normal Apple services apart from visual voicemail.

"We are happy to offer iPhone buyers the freedom of choice that customers are entitled to expect from a service provider," says Oliver Steil, Debitel's marketing chief.