What Does an Unlocked Cell Phone Mean?

An unlocked smartphone costs several hundred dollars, as of March 2012.

When you purchase a plan and mobile phone from a cellular provider in the United States, the phone is usually configured, or "locked," to run only on that provider’s network. Phones for GSM carriers, such as AT&T and T-Mobile, also come with subscriber identity module cards that provide access to the network, but if you try to use a SIM card from a different provider, the phone will not access the other provider’s network because it is locked out. An unlocked cell phone is a phone that is not configured or programmed to any specific provider network.

The Advantages of an Unlocked Phone

The biggest advantage to having an unlocked phone is that it allows you to switch between providers without having to buy a new phone. This is especially useful with personal digital assistants and smartphones, which are often expensive and a hassle to replace.
Having an unlocked phone also gives you more control over your provider options. Many wireless providers now offer month-to-month plans, so if you have an unlocked phone, you can test drive a mobile service without having to sign a contact or buy a new phone.
Some wireless plans are not available overseas, or the roaming charges are incredibly high. An unlocked GSM phone allows you to purchase a prepaid SIM card and continue to use your phone for the duration of a trip.
Unlocked phones cut down on consumer waste because you don't have to dispose of your phone every time you change providers and, if you decide to upgrade, you can sell the old phone instead of recycling it.

The Disadvantages of an Unlocked Phone

Because the phone is not configured to any specific network, some network-specific applications may not be available. For instance, a BlackBerry configured specifically for Verizon may have Verizon-specific applications that an unlocked BlackBerry won’t have, and you may not be able to install those application on your device. Wireless providers want people to subscribe to their networks and use their hardware, so the networks may place software restrictions on “foreign” hardware. Providers also do not support foreign hardware. Therefore, if the phone breaks, is lost or stolen, or an application doesn't work, you're on your own for support.
Unlocked phones are also more expensive than contract phones because the phone carriers subsidize plan phones upfront and spread out their cost across your phone bill for the life of your contract. Unlocked phones are sold at full retail price.

How to Get an Unlocked Phone

Computer companies like Dell and HP offer unlocked PDAs for purchase on their websites, as do Amazon and business-related stores like Staples and OfficeMax. Cell phone manufacturers may also offer unlocked phones directly for sale.

How to Unlock an Existing Phone

Some service providers, like Verizon, will unlock a cell phone once you have satisfied the terms of your contract. Others will not unlock a phone under any circumstances. In some areas, the staff at a store that sells phones from multiple providers may be able to unlock the phone for a fee. There are also online services that offer to unlock phones by either mailing the customer a code or having you send the phone to them. Not all of those services are reputable and you should use caution when dealing with them. Unlocking a phone can often be a hassle, especially if the carrier refuses to do it. The best option is to try to have the original provider unlock the phone. Find out about unlocking options before signing up with a wireless provider.

Conclusion

An unlocked cell phone provides you with flexibility and choice. And while the phones are more expensive than contract phones, and may have some software limitations, some consumers find that the pros outweigh the cons.

References

• PC World: The Joys of Unlocked Cell Phones
• Amazon: Unlocked Phone Guide