Joys of Unlocked Cell Phones

Joys of Unlocked Cell Phones
Discerning consumers and frequent travelers are among those who have
taken control with unlocked phones.
David Haskin, Computerworld
Sunday, August 12, 2007 7:00 AM PDT



Kristen Dennis's cellular carrier didn't offer the bright pink
Motorola Razr she desired about 18 months ago. And Andy Abramson
frequently travels abroad and was paying too much in international
roaming fees.

Both solved their problems with unlocked phones. Cellular carriers,
particularly in the U.S., usually lock the phones they sell so they
work only with that carrier's network. However, unlocked phones are
readily available that can enable owners to more easily switch
cellular operators and to get more features and services than specific
operators offer.

Dennis, an assistant account executive for a Washington public
relations firm, said buying an unlocked phone was easy.

"The only problem at the beginning was text messaging," she recalled.
"You have to insert some Cingular codes, so I went to [an online]
forum, got the codes and eventually figured it out. It took about half
an hour."

Buying new, unlocked phones or unlocking your existing phone is
perfectly legal in the U.S., although it's not as common as it is in
other parts of the world, most notably Western Europe. There,
countries such as Belgium don't even allow the sale of locked phones.

However, although buying an unlocked phone or unlocking an already
purchased phone can lower costs and provide other benefits, it is not
always a no-brainer and does not provide advantages for everybody.
Overcoming Hurdles

The most obvious impediment to using unlocked phones is that the
option is only available to those who subscribe to cellular networks
based on GSM (Global System for Mobile Communications) technology. In
the U.S., that means AT&T Inc. and T-Mobile USA Inc.

Phones that connect to such networks carry subscriber and network
information on Subscriber Identity Modules, which can be easily
inserted into the phone. If you own an unlocked phone and switch
carriers, you simply take out the old SIM and put in a new one.

In contrast, networks based on CDMA (Code Division Multiple Access)
technology -- Verizon Wireless and Sprint Nextel are the largest in
the U.S. -- keep that information in memory, which, practically
speaking, locks the phones into a specific network. If you switch
carriers, you must buy a new phone.

There are many advantages to unlocked phones, only one of which is
simplicity.

"I buy phones and don't wait for my contract to be up," said Abramson,
who writes the blog VoIPWatch. That means he can get a new phone
whenever he wants to, without being locked into a new one- or two-year
contract.

For instance, Sony Ericsson Mobile Communications AB's Walkman music
phones are big sellers in Europe because of their strong media
abilities, but few are sold by U.S. carriers. Similarly, HTC Corp.'s
new Touch and LG Electronics' Prada are often compared to Apple Inc.'s
iPhone, but neither is sold -- yet -- in the U.S.

Another reason to use unlocked phones is to save money when traveling
internationally. U.S. cellular operators typically charge high roaming
fees when their subscribers travel overseas. But with an unlocked
phone, you can buy a SIM card at your destination and pay local rates,
which typically are far less expensive.

"I'm going to Montreal tonight, and the first thing I'll do is get a
pay-as-you-go SIM," Abramson said. "I'll be there for three days. That
might not sound like a long time, but one time I was there for three
days and my bill was $200."

The primary downside to swapping SIMs when traveling is that your
phone number will be different in the country you travel to, so you'll
have to give friends, family and colleagues your new number. But for
business travelers, this arrangement has certain advantages, Abramson
noted.

"Presumably, you'll be calling people locally when you're in another
country, and if you call them and they need to call you back, they
just have to make a local phone call instead of making an
international call," he said. "It's a matter of courtesy."
Getting an Unlocked Phone

While unlocked phones are legal, cellular operators are under no
obligation to sell them or to help you unlock a phone you already own.
However, there are numerous ways to get your hands on an unlocked
phone, according to Evan Silbert, president of Warlox Wireless, which
sells unlocked phones and unlocks phones customers already own.

For instance, U.S. cellular operators have been slow to pick up some
of Nokia Corp.'s high-end N-series phones, which offer high-megapixel
cameras and a host of other features not found on many phones. As a
result, Nokia has opened stores in Chicago and New York to sell their
unlocked phones.

In addition, unlocked phones are readily available from many online
stores, including general retailers such as Amazon.com and Buy.com, as
well as from many specialty merchants. Two examples of such merchants
are PureMobile and CellHut.

Cellular operators may help you unlock your phone, or they may not. A
spokesman for T-Mobile said the company will help customers unlock
phones after their accounts have been active for 90 days.

Mark Siegel, an AT&T spokesman, said, "I think we have a pretty
customer-friendly policy." Specifically, he said the company will help
customers unlock their phones after they have completed their contract
terms. However, he didn't know the company's policy for those who want
to unlock their phones during the term of a contract.

You may need to be insistent to get help from your cellular operator,
said Derek Kerton, principal of The Kerton Group, a telecommunications
consulting firm.

"You have to jump through some hoops to do it, but they'll eventually
help you," Kerton said. "You'll have to call the call centers and
explain to the reps that their company will do it. Many customer reps
haven't heard about unlocking."

Eventually, though, the customer rep should give you both the "unlock
code" that unlocks the phone and instructions about how to enter the
code. The process is different for every type of phone.

For many, an easier option is to use one of the numerous companies
that will unlock a phone for you. Warlox Wireless' Silbert said the
cost is typically between $20 and $100, depending on how complex the
procedure is. He said that many older phones are relatively simple to
unlock, while some newer phones can be much more complex.
A No-Brainer?

One reason unlocked phones aren't more common in the U.S. is that the
freedom they provide comes at a price. For example, Cingular offers
the Samsung BlackJack smart phone for as little as $99 with a two-year
contract. However, shopping the Web, the lowest price we found for an
unlocked BlackJack was $328.

The cost difference is the result of carriers subsidizing the price of
phones to entice new users, which has long been a common practice in
the U.S.

"When a carrier subsidizes a phone, they have the right to lock you
into a contract," Kerton said. "But it's like getting a two-year lease
on a car, and the car dealer striking a deal with Shell saying that's
where you have to get your gas."

Another disincentive, particularly for corporate users, is the hassle
of using unlocked phones, Kerton maintained.

"If a company has people traveling abroad and there's the option to
unlock the phone and use a local SIM, it usually isn't worth it,"
Kerton said. "True, companies can save money, but what's the price of
having the [traveler] find a store and buy the SIM, then open the
phone and put the SIM in? It adds up to hassle, which IT doesn't want
and travelers don't want. It's hard to get ROI when there's hassle."

A better approach, Kerton said, is for companies to negotiate better
roaming rates with their cellular operators. Still, some large U.S.
companies do use unlocked phones.

"We just unlocked some phones for Cisco," said David Baker, owner of
UnlockMyPhoneNow.com. "We've done it a number of times for companies.
Often, it's to save the expense of buying new phones when they switch
carriers. They have perfectly good phones. Why should they buy more
phones?"

But, Baker and Silbert acknowledged, the majority of their customers
are individuals comfortable enough with technology to open their cell
phones. For Abramson, the benefits far outweigh any drawbacks.

"As a user, I don't have to change my habits to suit the carrier," he
said. "I can do things and use applications without the carrier's
cooperation."

David Haskin is a Computerworld contributing editor specializing in
mobile and wireless issues.

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