French mobile phone operator Orange will sell unlocked iPhones for €649 ($964), far below the €999 that T-Mobile charges in neighbouring Germany.

The price falls to €399 with a special iPhone airtime contract of at least one year, the same as in Germany.

The four "Orange for iPhone" tariffs include free access to the iPhone's visual voicemail service, and what Orange describes as "unlimited" access to email and the Internet.

However, the small print strictly forbids reading newsgroups, making VoIP calls, sharing files over peer-to-peer services or using the iPhone as a modem with a notebook PC. Orange also warns that it may limit traffic above 500M bytes per month, or around 1MB of data for every waking hour.

Orange is the fourth mobile network operator to sell the iPhone, following in the footsteps of AT&T in the US, T-Mobile in Germany and O2 in the UK Twelve Orange retail stores, including a brand new one on the prestigious Champs Elysées, will stay open late to begin selling the phones Wednesday evening, from 6.30pm.

When the phone launched in the US in June, Apple forced anyone buying an iPhone there to sign up with AT&T for a two-year contract if they wanted to use it. That policy marked the start of a game of cat-and-mouse, with hackers trying to unlock the phone, and Apple regularly updating its firmware to thwart their efforts.

Apple's plans for similar exclusive deals in Europe came unstuck days after the phone's launch with O2 and T-Mobile on November 9, when rival operator Vodafone sued T-Mobile under a German law that makes it illegal for retailers to force customers to buy one product (in this case an airtime agreement) in order to obtain another.

T-Mobile now sells unlocked versions of the iPhone that will work with any operator's network for €999, in addition to the version tied to its German network.

The unlocked price of the iPhone in France compares favourably with that of Nokia's N95, which sells for €829 without an airtime contract, or €269 for those signing a two-year contract with Orange rival SFR.

Nokia's phone lacks the iPhone's touch-senstitive screen, but includes a GPS (Global Positioning System) receiver for navigation and works on 3G (third-generation) high-speed mobile networks, where the iPhone is constrained to older EDGE (Enhanced Data rates for GSM Evolution) networks.

Orange will also unlock the iPhones sold with an airtime contract: The fee is €100 during the first six months, but after that, French law requires that it unlock phones for free.