What is an unlocked cell phone?
What are the advantages and disadvantages of unlocked cell phones?
How do I choose an unlocked cell phone?
What does the future hold for unlocked cell phones?

What is anunlocked cell phone?

A locked phone is a phone that’s restricted to working with one service provider only. That’s why a T-Mobile customer, for example, can’t just stroll into an AT&T store and walk out with a brand-new phone without also switching carriers. To many customers, this predicament isn’t a big deal, as all they want from a phone is reliable service and a few synchronized functions. But others aren’t quite so optimistic and believe that once they own a phone they should have the freedom to decide how to use it. If you’re in the latter group, consider buying an unlocked phone as an alternative.
At its core, an unlocked GSM phone is simply that: a phone that’s not locked into a single carrier’s network. In other words, you can choose your carrier and phone independently, albeit with a crucial caveat–unlocked phones only work on GSM-based networks, which effectively eliminates a couple of major carriers from consideration (Verizon and Sprint). The technology is simple from the consumer’s perspective: GSM phones contain a small, removable card, known as a SIM (Subscriber Identity Module) card, that’s programmed with your subscription information and phonebook. If your phone is unlocked, you’re free to remove your SIM card and insert it into another unlocked phone without losing your contacts or carrier data.
Unlocked phones aren’t a new phenomenon, but until recently, consumers could buy them only in “gray” markets (i.e., markets where phones from other countries were sold–mostly phones from the European and Asian markets). That’s changed as of late, and now manufacturers are selling unlocked phones in the United States in far greater numbers.
That’s an important detail to understand–you don’t always need to buy a new unlocked phone if you’re happy with your existing GSM phone; instead, you can have it unlocked. Although it’s sometimes possible to do this yourself if you know the unlocking code–a number that corresponds to each cell phone–many people opt for a postal unlocking service. In the latter case, the user sends the phone to a specialist, who makes the modifications and sends it back with a damage-free guarantee. This is typically the best option for non-expert consumers, as some brands require extensive hardware modifications that can easily harm the phone if performed improperly.

What are the advantages and disadvantages of unlocked phones

So why buy a new unlocked phone? The main reason is flexibility. If you have your eye on a cool phone that your GSM carrier doesn’t offer, such as the powerful palmOne Treo 650 or the Motorola special-edition RAZR V3, you can snap it up without worrying about service. You’ll also have the flexibility to change GSM carriers without changing phones–a nice option if prices or coverage areas change. And enterprising users can add extra applications to their unlocked phones, ranging from the basics (new ringtones) to more complicated games, animations, web programs, and business tools. Not every application works with all carriers or phones, however, so you’ll need to do some research first.
Some manufacturers even sell unlocked hybrid phones, which switch between a cellular network and high-speed Wi-Fi networks. The most sophisticated of these phones can switch between the two networks automatically, so you can sit in a coffee shop and download photos via Wi-Fi, receive a call, and then walk out the door and into cellular coverage without losing the signal. And finally, unlocked phones are terrific for overseas travel. Rather than relying on your current provider’s spotty European or Asian coverage, you can buy a prepaid SIM card in Italy, for example, and simply pop it into your phone. In essence, unlocked phones put the control back in your hands rather than the carrier’s.
That doesn’t mean that unlocked phones are ideal for everyone, however, as carriers still have the advantage in many areas. For one, carriers typically pre-configure their locked phones with a number of functions–T-Mobile, for example, offers one-button access to such “t-zone” services as e-mail, movie listings, news, and more–while unlocked phones require manual programming to provide the same services. More frustratingly, some carriers install exclusive software on their handsets to enable specific features, an option that’s often unavailable to the owner of an unbranded unlocked phone. T-Mobile’s myFaves program, which lets you call up to five contacts with no limitation on free minutes, requires the use of a T-Mobile handset that supports the service, while many of AT&T’s mobile broadband solutions require compatible AT&T handsets.
Perhaps the biggest drawback, however, is price. Because carriers offer steep discounts on locked phones to entice you into signing long-term service agreements, you often can get phones far below actual cost (sometimes even for free). An unlocked phone, by contrast, can cost several hundreds of dollars, and even the most basic phones are generally more expensive than you might expect when you aren’t buying through a carrier.

How do I choose an unlocked phone?

 
The most important thing to understand is which frequencies, or bands, the phone supports. GSM carriers in the United States, Canada, and many parts of Latin America rely on the 1900 and 850 bands for transmitting cellular phone calls and data. In the United States, the 1900 band is used extensively in urban and developed areas, while 850 has largely been used to boost signal strength in outlying areas. At the minimum you’ll want a phone that supports the 1900 band if you live in North America.
Europe and many other parts of the world employ two other bands: 900 and 1800. If you plan on traveling a lot internationally but want to own only one phone, consider purchasing a quad-band phone, which will give you coverage all over the world. If you aren’t a frequent international traveler but do make occasional trips, a less expensive tri-band phone will probably suffice. A phone that supports the 1900, 850, and 1800 bands will provide great service in the United States and passable service in Europe.
The other thing to keep in mind is that even though unlocked phones do offer some advantages, they only work with GSM-based T-Mobile and AT&T networks. If you prefer Verizon or Sprint, you might want to stick with their pre-configured phones.

What does the future hold for unlocked phones?

Almost all technological platforms face a conflict between innovation and control, and cell phones are certainly no exception. Cellular carriers argue that they need to preside over the hardware in order to provide better, more integrated services to customers, and many have indeed invested billions of dollars in comprehensive service networks. Consumer advocates counter that innovation stems from choice, and that opening up the marketplace to broader competition will lead to a variety of new phone features, better communication between phones and related accessories, and a wider price range.
So will the restrictions supported by the major U.S. cellular carriers eventually start to unravel? It’s arguably already happening, albeit in extremely small steps. Not only are unlocked phones easier to buy in the U.S. market than in the past, but unlocking services–the companies that unlock your carrier-provided GSM phone–are starting to appear in malls and other mainstream locations, a sure sign that demand is increasing. In addition, international business travelers are returning to the United States with satisfied tales of using prepaid SIM cards in Europe and Asia, thus spreading the unlocked gospel bit by bit. If these and other consumers continue to demand more and better options, it’s possible that cellular carriers eventually will open things up.
Hybrid phones that are capable of operating on non-cellular networks–such as Wi-Fi or eventually WiMAX–also might force carriers to shake things up, as they run the risk of losing business to such technologies. The biggest threat, however, likely comes from third-party manufacturers with established brand loyalty, such as smaller cellular carriers that support GSM-friendly unlocked phones and combine unlimited minutes and low prices.

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