Freeing Consumers via Unlocked Cell Phones

Cell phones have long been popular but you could only use certain phones with certain cell phone operators. Today, that may be slipping to some degree as unlocked phones are being marketed to some degree by both Nokia and Motorola.

Unlocked phones have not been available to Americans in general, just in the cases where unlocked phones were purchased overseas and brought to the United States. The benefit of unlocked phones is that they may be used on a variety of networks. However, the grey market is no longer necessary to bring us unlocked cell phones as some of the big players in the industry are selling them on their websites.

Americans in general like choices and they have that in most all sectors except the cell phone market. In this market consumers may choose from just a few cell phones that belong to a particular service provider. What this means is that Alltel phones are sold only for Alltel service plans as well as Verizon phones for Verizon service and so on and so forth. Besides not having options in the cell phone you choose you also do not have much of an option to use your phone if you switch carriers. It does not matter if the same phone is offered on both networks. That is because the phone is programmed for one particular cell network and no other.
It is really interesting how phones are sold worldwide as compared to how they are sold in the US. For example, approximately 70% of the cell phones sold in Europe are sold unlocked. And 80% of cell phones sold in Asia are sold separately from a cell service provider. However, in the United States up to 95% of cell phones are sold by the mobile service provider.

How it Works
It really is a subsidy. Cell phone costs are subsidized by cell phone carriers offering discounts for purchasing a particular phone and signing a two year service plan. The result is that many individuals receive their cell phone free of charge or for a very low rate simply for signing the contract. The result of this is that phones are cheaper so more people are able to buy a service plan. The downside is that American consumers are controlled by the mobile operators. So, the carrier is who decides what cell phones and features they will offer to consumers regardless of the cell phone or features the consumer might want.

The result of this is a very low selection of products even though many more are being produced and marketed. Nokia is a great example of this. Last year Nokia introduced some 50 new products yet of those 50 only a few were actually marketed in the United States.

Nokia was one of the first to begin selling unlocked phones in the United States. These include its fashion phones as well as the smart phones.  There are other stores like CompUSA dealing with unlocked phones as well from manufacturers like Sony Ericsson, Motorola, and Nokia.

So, while these companies are dabbling somewhat in the unlocked phone market it does not appear that North America is quite ready for a free market where cell phones are concerned. The fact that the carriers subsidize the cell phones makes it more affordable for many Americans to buy the cell phone of their dreams where this probably would not be the case if cell phones were purchased separately from cell phone services. For now it looks like things will stay pretty much the same with just a new option to buy unlocked phones from certain retailers.