Apple and France Telecom are struggling to come to an agreement on the distribution of the iPhone if reports in business magazine Challenges are to be believed.

Although Apple has never issued an official statement about iPhone in France, it is widely expected that France Telecom's Orange will carry the iPhone.

The company's chief exec Didier Lombard made a statement earlier this month, but not a very definitive one, with availability unconfirmed as "before Christmas, probably in November" and no pricing announced.

According to the French mag, this week, it has said, without citing sources, that Apple and France Telecom are at odds over the percentage of service revenues the telecom operator had to give to Apple as part of the distribution deal.

If the two groups fail to come to an agreement, the launch of the iPhone handset in France in time for the crucial Christmas season could be jeopardised, Challenges said.

It was widely expected, following Lombard's uncertain statement, that the device would be officially launched in France by both parties to a home crowd at the Mac EXPO event that's currently taking place.