Unlocked Phones: How and Why to Do It - InformationWeek

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Unlocked Phones: How and Why to Do It

An unlocked phone is one not tied down to a specific carrier network. If you want to use an unlocked phone, what are the practical implications? Who sells unlocked phones? What carriers let you unlock theirs and activate others? BYTE explores these issues and tells you why you might want an unlocked phone and how you'd go about buying one and getting service for it.

Most cell phones that users buy are tied, or 'locked' to a single carrier's network. Carriers do this because they don't want consumers to take their business elsewhere and we put up with it because the carriers are usually subsidizing the cost of the phone. But it doesn't have to be this way. You can also buy an 'unlocked' phone that will run on any carrier that supports the network architecture used by the phone, although as a practical matter, such phones have to use GSM. The benefits of using such a phone are considerable. In this special report, BYTE contributing editors Chris Spera, Max Cherney and Serdar Yegulalp explain why consumers might want an unlocked phone, how to go about getting one and activating it and why it doesn't work with all phones on all networks. They also provide background on why phones are unlocked, and the legal implications of unlocking them yourself.

Carrier locked, or just "locked" phones are commonplace in the U.S. Most everyone we know has a phone that's been locked for some length of contract term by either a national or large regional carrier. It's really just the way we're used to buying into the cellular market — consumers pay a subsidy in order to be able to pay a little for a high-end phone. The tradeoff is they lock themselves into a long-term wireless communications contract for a minimum of one year.

iPhone in the USA: Locked, subsidized and affordable

In Europe, it's a different story. Many high-end phones are sold without a subsidy and at prices higher than in the US. Popular cell phones are not cheap at full list price: an unlocked iPhone 5 runs from $649 (16GB) to $849 (64GB) In the UK the iPhone 5 starts at €529 which works out to $687 at the exchange rate as we write this.

iPhone in the UK: Unlocked and dear

Consumers pay a lot now — usually $400 or more over the lower, subsidized price — but can take their phone to the compatible carrier of their choice, shopping around for a wireless communication plan that meets their needs and budget. The differences between the two approaches can be summed up as follows:

  • Carrier locked phones are cheaper to obtain but usable only with the cellular network they were purchased on.
  • Wireless carriers subsidize the purchase price of a high-end cell phone, making obtaining an expensive device affordable, but spread out the full price of the device in a higher priced, usually two-year voice and data plan contract.
  • Unlocked phones are available at full retail price, but usable on any compatible cellular network
  • Usually the only difference between a locked and unlocked version of the EXACT same phone, minus any carrier branding, is a hidden software setting, permitting use on one cellular network and blocking use on any other cellular network.
  • Unlocking a cell phone is the act of removing, or turning off this hidden setting.

It's Now Illegal to Remove a Cellular Carrier Lock

Put simply, a carrier locked cell phone contains software that prevents its use on any unintended cellular network. According to provisions in the Digital Millennium Copyright Act, phones purchased as of Jan. 27, 2013 may not be unlocked without the expressed permission of either the hardware manufacturer or the cellular network it is currently locked to, or both. Doing so without permission is now considered illegal.

Under the DMCA, the Librarian of Congress has the discretion to grant exemptions to portions of the act. Prior to Jan. 27 such exemptions were granted, but they have expired and he has no plans to grant a new one.

InformationWeek's Eric Zeman asks what is the upside for enterprises if lawmakers allow unlocking of phones?

The outrage over this change led to a petition on the White House website to end the ban. The White House expressed sympathy with the petition and R. David Edelman, senior advisor for Internet, Innovation, & Privacy, said they would pursue changes, but in the meantime unlocking without permission remains illegal. Performing an unauthorized device unlock is currently punishable by up to five years in prison and a $500,000 USD fine.

But many carriers allow, even assist with unlocking your phone once your contract is up.

Next: You buy and use an unlocked phone...

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