Deutsche Telekom AG' mobile unit said Wednesday it would offer Apple's iPhone without a contract to comply with a court injunction, but consumers that opt out of a two-year contract will pay more than twice as much for it. T-Mobile will start selling the phone for 999 euros ($1,477) immediately as well as continuing to offer it for the discounted 399 euros ($590) in combination with a two-year contract, the company said in a press release. The iPhone made its German debut on Nov. 9 - available only with the two-year contract from T-Mobile. The German unit of rival Vodafone protested that practice at a state court in Hamburg.

The court issued an injunction, dated Nov. 12, barring T-Mobile from offering Apple Inc. s iPhone exclusively with the minimum 24-month contract, and also from selling it only with a so-called SIM lock that prevents users from switching the device to any other operator's network.

T-Mobile said any customer can now also have the SIM lock on their phone removed - including those who have already purchased the iPhone.

The company released statement saying it would abide by the conditions "until the legal situation is resolved." The company could not immediately be reached for comment.

Companies routinely offer phone discounts to customers who sign up for lengthy contracts.

T-Mobile's popular Nokia N95 sells for as little as 199.95 euros ($295.63) with a two-year contract, or 619.95 euros ($916.60) without one.

On Tuesday, T-Mobile said it would appeal the injunction and it also said it reserves the right to consider seeking damages.

The new phone is not operating on Europe's fastest, so-called 3G networks, but is relying on a different technology called EDGE. T-Mobile argued that it is the only carrier to offer EDGE across Germany.

The iPhone is a combined cell phone and iPod media player that also can access the Internet wirelessly.

Vodafone could not immediately be reached for comment.

Written By KIRSTEN GRIESHABER