Friday, December 08, 2006

Motorola, Nokia Set Cell Phones Free Motorola, Nokia Set Cell Phones Free

It is finally time: Motorola, Nokia Set Cell Phones Free. Phone manufacturers are starting to sell unlocked phones and the U.S. Copyright Office just announced that cellular providers can't use copyright to lock in their subscribers.

What this all means is that the U.S. cellular companies have long tied sales of phones locked into their networks to usage of their networks. Thus, whenever you switch cellular providers, you needed to buy a new phone. If you had an expensive phone, this made switching even harder. Since the cell companies most often subsidize the purchase of phones, they also charge huge termination fees if a subscriber terminates service before the end of his contract. But for a long time, this locking-in has been strategic, not functional, as the phones work just fine on other carrier's networks (that is why we have standards). The cell providers did this because they made more money this way, and the cell manufacturers went along with it because the providers sold most of their phones and they figured that they sold more cheap phones this way. But it turned the cell manufacturing business into a commodity business, since there was a disincentive for buying expensive phones, and they now see potentially much higher profit margins on selling non-commodity phones.

Of course, there are always die-hards:
As advantageous as unlocking phones may be for handset makers, it also carries risks. Carriers could fight back by cutting back on orders and bolstering ties with suppliers that don't sell unlocked versions. They could cut their subsidies of offending handset makers' phones. And they could refuse to sign up users who have unlocked phones. "We do not activate wireless devices that come from other carriers or directly from manufacturers," says a Sprint Nextel spokesperson, "because we can't guarantee the quality of service."
This later company is the one that charges me (through Qwest which sold its network to Sprint a couple of years ago) for roaming in areas around here where I used to have decent coverage. It is plain silly for Sprint to be using this excuse, given their own lack of quality.

Labels:

10:24 AM Display: Full / Chopped / Footer

Display: Full / Chopped / None

Display: Full / Footer / None

Display: Chopped / Footer / None

0 Comments:

Post a Comment

Links to this post:

Create a Link

<< Home >>