Have you ever wondered why smartphones online can cost up to $800 whereas inside the Wireless Carrier’s store its only $199? Wireless Carriers do this as an incentive to customers, so that they will buy a two-year agreement. But what happens if you sign-up for a Pre-Paid and get the smartphone at a low, low cost just to switch carriers?
Carriers such as AT&T install specific locks onto their smartphones to prevent the movement of phones to another carrier. Many clever programmers have found a way around this lock by simply removing it and reselling the device as an “unlocked smartphone”. Until just recently this was completely legal.
Unfortunately for all of those customers that use an unlocked smartphone to get around those pesky long-term agreements it is now illegal for programmers to unlock phones. The Library of Congress, which handles the rulemaking of the Digital Millennium Copyright Act, has stated that starting this Saturday (1/26/2013) the unlocking of a smartphone without the wireless carrier’s consent is illegal.
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Originally Posted by Library of Congress
…with respect to new wireless handsets, there are ample alternatives to circumvention. That is, the marketplace has evolved such that there is now a wide array of unlocked phone options available to consumers. While it is true that not every wireless device is available unlocked, and wireless carriers’ unlocking polices are not free from all restrictions, the record clearly demonstrates that there is a wide range of alternatives from which consumers may choose in order to obtain an unlocked wireless phone.
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This new law heavily affects online cell phone sales from places like eBay and Amazon that sell a large amount of unlocked smartphones. There is still the advantage of buying an international phone and using it instead of the locked carrier phones with no issue.