Print 22 comment(s) - last by xti.. on Apr 9 at 4:09 PM

At the end of their contract, customers can now switch to other GSM carriers

Typically, smartphones using the GSM 3G standard can simply swap out SIM (subscriber identity module) cards to switch between carriers.  This is good news for those wishing to jump to a different GSM carrier when they move or when their contract expires.  But the bad news is that many manufacturers allow carriers to "SIM-lock" the phones, adding provisions to the firmware that prevent users from swapping SIMs.

The anti-competitive move effectively cripples users' phones to an extent and has drawn pushback from consumer advocates.  Recently, new Apple, Inc. (AAPL) CEO Tim Cook took a stand against the practice.  Much as Steve Jobs personally responded to a handful of emails a week, Tim Cook personally came to the defense of a customer whose iPhone 3GS was locked by AT&T, Inc. (T).  Pressure applied, AT&T caved and did the unlock.

Now it looks like things have been taken a step further, with AT&T annoucing plans to unlock all customers' iPhones who wanted to leave when their 2 year contract was up.  This was a big deal because for some time now the iPhone has been the only phone that AT&T does not allow to be unlocked at the end of their contract.

iPhone 3GS
iPhone customers can now easily hop from AT&T to T-Mobile USA at the end of their contract.
[Image Source: Gizmodo]

AT&T revealed the policy in a statement to MacRumors, commenting:

Beginning Sunday, April 8, we will offer qualifying customers the ability to unlock their AT&T iPhones. The only requirements are that a customer's account must be in good standing, their device cannot be associated with a current and active term commitment on an AT&T customer account, and they need to have fulfilled their contract term, upgraded under one of our upgrade policies or paid an early termination fee.

MacRumors was also the first to report Tim Cook's personal efforts to convince AT&T to unlock the aforementioned emailer's iPhone.

The move makes it easy for U.S. customers to move to Deutsche Telecom AG (ETR:DTE) subsidiary T-Mobile USA -- the other major GSM network.  T-Mobile offers cheaper contracts and no data overages, both of which may attract iPhone customers.  AT&T's biggest selling point of super-fast LTE doesn't apply to iPhone owners, so there's little incentive to stay, except for those with grandfathered truly unlimited data plans or those who get their phones through an employer.

Source: MacRumors

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Capitalism = protectionism?
By michael67 on 4/6/2012 5:50:39 PM , Rating: 3
For over 10 years now here in the EU, providers have to unlock your, after your contract is fulfilled.
And ware i come form, it was all ready national law for 15 years.

Why is that not suds law in the US?

But then on the other hand, I don't get it, why people buy there phone from there provider.
I always got my self SIM only subscriptions, and payed only a fraction of what people with subscriptions payed.

And i also don't feel the need to change every time at the end of the subscription, used my Galaxy now for 3 years, only just traded it in, because the battery was dieing on me, for a Lumia 800, but maybe i give this one to my wife to replace her 5y old Nokia N95, and tried my self to a 900

RE: Capitalism = protectionism?
By shabby on 4/6/2012 8:16:33 PM , Rating: 3
And i also don't feel the need to change every time at the end of the subscription

Because americans want the latest and greatest, thats why they get new phones every 2 years and new cars every 5 years... and that's also why they're all in debt.

RE: Capitalism = protectionism?
By BillyBatson on 4/6/2012 8:19:59 PM , Rating: 3
New cars every 5 years? Try 2-3 years here in Los Angeles

RE: Capitalism = protectionism?
By Camikazi on 4/7/2012 6:19:18 AM , Rating: 2
My car is 11 years old, running perfect and I have no pl[ans on getting a new one any time soon. Don't lump us all in together, some of us do think about things.

RE: Capitalism = protectionism?
By tayb on 4/9/2012 12:58:35 PM , Rating: 2
Sorry, he just meant 95% of people.

No argument is logical. Not even the battery one because batteries can be replaced cheaply. People who have never been to American are usually disgusted by the amount of fat people and our ability to consume seemingly endlessly.

RE: Capitalism = protectionism?
By xti on 4/9/2012 4:06:10 PM , Rating: 1
11 years, holy crap you have to have a binder with coupons in it.

RE: Capitalism = protectionism?
By Solandri on 4/8/2012 3:13:21 PM , Rating: 1
For over 10 years now here in the EU, providers have to unlock your, after your contract is fulfilled. And ware i come form, it was all ready national law for 15 years.

Why is that not suds law in the US?

You have it backwards. What you've described in the EU is protectionism. Protectionism for phone buyers. I happen to agree with it, but it's still protectionism.

What the U.S. practices in this case is unfettered capitalism free from protectionism. Carriers are free to sell phones as they like, locked or unlocked. Except for T-Mobile, all the major carriers have chosen to lock the phone to themselves beyond the contract period. Sprint and Verizon in addition will not activate a phone locked to them, even if you do manage to buy a compatible unlocked CDMA phone from Asia.

The flip side is that buyers are free to pick whichever carrier/phone they want to buy. Unfortunately, the vast majority of customers seem (to my chagrin) to not care that that "their" phone will remain locked to the carrier even after it has been paid for and is legally completely theirs.

The rationale for the protectionism the EU practices in this case is that the majority of phone buyers aren't savvy or technically literate enough to know what locking is, and why they would want the phone to be unlocked. I agree with this rationale, and think carriers should be forced to unlock phones after the contract is up. But it's still government interference in a free market - protectionism.

RE: Capitalism = protectionism?
By Solandri on 4/8/2012 3:16:15 PM , Rating: 2
Sprint and Verizon in addition will not activate a phone locked to them

Sprint and Verizon in addition will not activate a phone not locked to them

RE: Capitalism = protectionism?
By dark matter on 4/9/2012 5:18:24 AM , Rating: 2
You have it wrong if you think capitalism does not lead to collusion whereby all parties give the consumer no fucking choice.

You make out that "the free market" is a cure all.

But one look at "broadband" and "cell phone" prices and download speeds puts paid to that notion.

RE: Capitalism = protectionism?
By bah12 on 4/9/2012 10:09:10 AM , Rating: 2
Actually he said several times that he happens to agree with protectionism in this case. So no the free market is not a cure all. Best case scenario the free market gets you Wal-mart, worst case the cellular carriers.

IMO the old adage "too much of anything is a bad thing" still hold true. A rampant completely free market is just as dangerous as an over regulated one.

Wal-mart is a prime example of capitalism running its course. The very idea of the survival of the "best" company for the customer dictates that at some point there will be only a couple of choices, if not only 1 choice (Google is another example regarding search).

Now as long as these few companies play by the rules and don't abuse that position, everyone wins. However over time the cost of entry becomes too large for anyone to compete. Here is the weird part, even if they are playing by the rules, their success and size alone makes them anti-competitive because the cost to compete with them is simply too high for a start-up to ever realistically meet.

Think about why the Mom and Pop's fail when wal-mart moves in. Wal-mart is able to leverage its vast supplier network to sell me a widget far cheaper than Mom and Pop can even buy it for (let alone sell it for). Has wal-mart done something wrong? Morally I suppose you could make the argument, but legally they've used a free market to source that widget as cheaply as possible, and passed that savings to the consumer.

Therein lies the problem, true free market will always lead to a limited consumer choice, and high cost of entry. By it's very nature a "100% free market" ultimately ends up being anti-competitive.

RE: Capitalism = protectionism?
By xti on 4/9/2012 4:09:51 PM , Rating: 2
means...some people have means, others don't.

this is a website that has to do with luxuries. People mad @ prices are struggling to keep up with the hobby.

For ANYTHING, there is almost always a low cost solutin, but you get what you pay for.

...can now switch to other GSM carriers
By micksh on 4/6/2012 6:20:35 PM , Rating: 3
Like there are many of them.
iPhones don't support T-Mobile 1700MHz 3G band. Those who switch will be limited to EDGE data speed. iPhone owner must be in desperate need to save money in order to sacrifice 3G and switch to T-Mobile.

By dark matter on 4/9/2012 5:21:54 AM , Rating: 2
Besides the point. The option should be available.

By theapparition on 4/9/2012 2:46:39 PM , Rating: 2
Glad you mentioned this, I thought the same.

truly unlimited?
By Trisped on 4/6/2012 4:27:52 PM , Rating: 3
except for those with grandfathered truly unlimited data plans
I though it had been reported that AT&T was throttling the plans of heavy users?

RE: truly unlimited?
By BillyBatson on 4/6/2012 5:23:42 PM , Rating: 2
Yeah I'm not sure why they would use a word like "truly" when for the last at least 4 months AT&T has been throttling after 2gb and after being sued have switched it to after 3gb.
Tmobile still offers plans much closer to "truly" unlimited than those of us grandfathered with AT&T.

Its a step....
By Adam M on 4/8/2012 6:03:24 PM , Rating: 2
Maybe now that they are unlocking iPhones, they can be coerced to unlock other brands as well. I would like to see other carriers follow suit. If I am not on contract, then I should be able to go to any carrier that can support my phone.

RE: Its a step....
By dark matter on 4/9/2012 5:25:50 AM , Rating: 2
Well, that's the "free market" for you.

Obviously the "consumer" doesn't want that, otherwise it would be offered in the "highly competitive" cell phone environment.

I suppose you're alternative is to not purchase (as many defenders of "American Capitalism" would have you believe)

Because after all, the "carriers" must be right, as they HAVE to compete against each other. Not that they would look at each others prices or collude to set them so the level of competition is minimal. No, that would never happen with two giant incumbents.

That must be why the price of broadband and cell phone plans is so cheap in America, and the speeds are out of this world... All that competition.

iPhone on T-Mobile
By HrilL on 4/9/2012 1:00:18 PM , Rating: 3
Sure you can switch over but you're not going to be too happy. the iPhone doesn't support the 1700Mhz band and that is what T-Mobile uses for 3G so sure you can use EDGE on T-Mobile but your iPhone won't be getting the faster 3G speeds.

By zlandar on 4/6/2012 6:39:00 PM , Rating: 2
Forget tmobile. Straightalk is a better deal and likely better coverage. Odds are you may end up on AT&T network through straightTalk.

AT&T is still evil
By djdjohnson on 4/6/2012 8:31:49 PM , Rating: 2
T-Mobile will unlock phones after 90 days. You still have a termination fee if you cancel your contract early, but they'll help you unlock your phone long before the contract is up.

By drycrust3 on 4/7/2012 2:19:23 PM , Rating: 2
with AT&T annoucing plans to unlock all customers' iPhones who wanted to leave when their 2 year contract was up.

Someone put a comment along this line on the Daily Tech website a few weeks ago.
The reasoning they had was during the contract period the phone belongs to both AT&T and the user, but at the end of the contract period the phone has been paid off and belongs solely to the user, so the SIM-lock should automatically be removed from the phone.

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