Legal Issues

by Mike Masnick

Consumers Union Asking To Stop Handset Locking

from the what's-the-legal-reasoning? dept

Consumers Union has stepped in to ask the FCC to stop mobile phone locking so that people can buy mobile phones they can use with different wireless carriers. While it's possible to get some unlocked GSM phones, they're usually much more expensive and the carriers do everything to avoid having people to do so. The reasoning, of course, is that a locked handset means the customer is less likely to switch. Like with number portability, this is short-term thinking on the part of the carrier. They're focusing on the wrong thing: figuring out ways to lock in customers with artificial barriers rather than good service that turns them into happy, loyal customers. The carrier's response, of course, is that by locking handsets they are more likely to keep the customer long term. Thus, they can subsidize the cost of the handset, making them much cheaper for customers. It's a valid point, but again, the incentives are out of whack. If the focus really was on unlocked phones, it would drive the handset makers to figure out ways to make cheaper phones, and would drive down hardware costs to make the phone affordable to users. All that said, I think it should be a strategic, and not a legal decision. I think carriers would be smart to offer unlocked handsets and to advertise their openness (and customer friendliness) because (if it's actually true) they could win a lot of business that way from disgruntled users of other services. However, if they really want to try to hang onto a closed system, I'm not convinced there's a good legal reason why they shouldn't be allowed to do so. At least in the US, there's also the issue of the different network types, and the fact that it's not so much locking as different network technologies that would prevent people from using the same phones between different carriers.

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