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Locking phones is not at all a requirement for carriers to offer subsidized deals. They could offer phones on installment plans conditional on an N-month contra

Locking phones is not at all a requirement for carriers to offer subsidized deals. They could offer phones on installment plans conditional on an N-month contract. The buyer could switch carriers and keep the phone, but be on the hook to pay off the rest of the contract term. The only reason to use technological locks is to further trap a customer into a carrier relationship beyond the legal terms of their contract. It's yet another example of companies violating long-standing rights and norms and getting away with it because there's a computer involved.

cwyers 2y ago
The counterpoint is that by locking people into carrier relationships allows T-Mobile and AT&T to offer loans on consumer electronics at much more consumer-friendly rates than others in the same business, e.g. Rent-A-Center. As I note downthread, `The total cost to buy a PS5 Slim is $500, the total cost to get a PS5 Slim through my nearest Rent-A-Center is $1,349.50.` You could introduce this pricing for iPhones for poor people too! This might even incentivize more people to use low-end Android hardware! But let's not act like this is 100% a good thing for everybody.
- happymellon 2y ago
  > The counterpoint is that by locking people into carrier relationships allows T-Mobile and AT&T to offer loans on consumer electronics at much more consumer-friendly rates than others in the same business How does it do that? Its a lock to force people to stick with a provider, and pay through the nose in other ways. Phone plan rates in the US are terrible, restricting peoples ability to change provider through artificial means doesn't provide better rates.
  - labcomputer 2y ago
    Because it greatly lowers the risk that AT&T will need to write off the debt for your phone and sell it to a collections agency for pennies on the dollar. It’s the same difference as a home mortgage vs unsecured credit card debt: When the threat exists that the lender can repossess your home if you don’t pay… they don’t have to worry as much about you not paying your mortgage, so they can offer a much lower rate.
    - itopaloglu83 2y ago
      Maybe then they should put a lien on it and call it the phone title, not lock status.
      - ac29 2y ago
        The cost to repossesses and resell a phone is going to greatly exceed its value in nearly every case, so this idea wouldnt work.
        itopaloglu83 2y ago
        One of the main goal of a lien is to make sure that the debtor pays. I would say the locking mechanism helps that greatly.
  - neodymiumphish 2y ago
    You buy a phone for $1k, but you do it through your carrier, along with a $50/month plan. Because you’re on this plan, the carrier offers $600 off the phone price, paid in account credit over 24 months ($25/month), so your total monthly bill becomes $67/month for 2 years, then $50/month at the end of 2 years. If, 3 months in, you find yourself unhappy with your carrier, you can still pay the remainder of your phone cost ($875) to own your phone outright and walk away. In that time, you’ve saved $75 off the full price of the phone. Arguing that US carrier prices are exorbitant is not relevant to whether carrier locks and phone discount credits are worthwhile or cost effective.
    - happymellon 2y ago
      I'm not sure what that has to do with locking your phone. If you have a line of credit for the cost of a phone, then you have a line of credit for the cost of a phone. If you have a contract for service, them you have a contract for service. If you try and terminate either then they will reclaim based upon your contract with them.
      - neodymiumphish 2y ago
        And the lock is collateral against a small, high-demand object that can easily be fenced. The phone lock is essentially the same as a hold against a car title until it’s paid off. This would only be a real problem if there were no options to buy phones direct/outright without the lock. Instead, we’re likely to end up in some situation where carriers work with phone manufacturers to implement a sort of higher-level device lock feature that stipulates the device “belongs” to the carrier and can be functionally locked (a la the stolen device lock features that currently exist) if they ever go unpaid.
deleted 2y ago
[deleted]
jjmarr 2y ago
What happens when the buyer says "no, I'm not paying" and sells the phone? Instant money. Meanwhile the telecom company has to sell the debt at a massive discount to a collections agency or spend a ton of money collecting on it. That's assuming it can be collected on at all from someone that might just be running a scam. With a locked phone, the phone just stops working and loses most of its value. A rule forcing carriers to unlock phones after the term is up is fine. Forcing them to do it before is illogical. How many people are going to pay for two plans on one phone because they didn't like the first plan? I doubt it's more than those who will immediately abuse this rule and stop paying for the phone. I don't see the benefit to society here.
- seabass-labrax 2y ago
  Being able to use a second carrier without cancelling a contract with the first is useful for international travel; the 'roaming' rate is often much higher than the normal rate of other countries' local telcos. Plus, mixing-and-matching plans can be advantageous to the user in certain situations even within one country. For example, data-only plans are typically cheaper than data+calls, but one might still want a very modest calls plan for infrequent use - sometimes, better value can be attained by combining two separate contracts. Of course, whether or not telcos ought to allow such use of their contract handsets is another question entirely!
  - neodymiumphish 2y ago
    If there’s a big enough market for this use case, I suspect at least one carrier would do so. I’d imagine this would include some sort of payment in escrow, temporary unlock feature, or an optional add-on. Otherwise, folks in this position should just buy the phone outright and unlocked so they don’t have any issues like you’re describing.
- __MatrixMan__ 2y ago
  The carriers getting screwed is the point here. The sooner their anticompetitive behavior backfires on them the sooner they'll stop doing it.
- 2y ago

cwyers 2y ago

The counterpoint is that by locking people into carrier relationships allows T-Mobile and AT&T to offer loans on consumer electronics at much more consumer-friendly rates than others in the same business, e.g. Rent-A-Center. As I note downthread, `The total cost to buy a PS5 Slim is $500, the total cost to get a PS5 Slim through my nearest Rent-A-Center is $1,349.50.` You could introduce this pricing for iPhones for poor people too! This might even incentivize more people to use low-end Android hardware! But let's not act like this is 100% a good thing for everybody.

happymellon 2y ago
> The counterpoint is that by locking people into carrier relationships allows T-Mobile and AT&T to offer loans on consumer electronics at much more consumer-friendly rates than others in the same business How does it do that? Its a lock to force people to stick with a provider, and pay through the nose in other ways. Phone plan rates in the US are terrible, restricting peoples ability to change provider through artificial means doesn't provide better rates.
- labcomputer 2y ago
  Because it greatly lowers the risk that AT&T will need to write off the debt for your phone and sell it to a collections agency for pennies on the dollar. It’s the same difference as a home mortgage vs unsecured credit card debt: When the threat exists that the lender can repossess your home if you don’t pay… they don’t have to worry as much about you not paying your mortgage, so they can offer a much lower rate.
  - itopaloglu83 2y ago
    Maybe then they should put a lien on it and call it the phone title, not lock status.
    - ac29 2y ago
      The cost to repossesses and resell a phone is going to greatly exceed its value in nearly every case, so this idea wouldnt work.
      - itopaloglu83 2y ago
        One of the main goal of a lien is to make sure that the debtor pays. I would say the locking mechanism helps that greatly.
- neodymiumphish 2y ago
  You buy a phone for $1k, but you do it through your carrier, along with a $50/month plan. Because you’re on this plan, the carrier offers $600 off the phone price, paid in account credit over 24 months ($25/month), so your total monthly bill becomes $67/month for 2 years, then $50/month at the end of 2 years. If, 3 months in, you find yourself unhappy with your carrier, you can still pay the remainder of your phone cost ($875) to own your phone outright and walk away. In that time, you’ve saved $75 off the full price of the phone. Arguing that US carrier prices are exorbitant is not relevant to whether carrier locks and phone discount credits are worthwhile or cost effective.
  - happymellon 2y ago
    I'm not sure what that has to do with locking your phone. If you have a line of credit for the cost of a phone, then you have a line of credit for the cost of a phone. If you have a contract for service, them you have a contract for service. If you try and terminate either then they will reclaim based upon your contract with them.
    - neodymiumphish 2y ago
      And the lock is collateral against a small, high-demand object that can easily be fenced. The phone lock is essentially the same as a hold against a car title until it’s paid off. This would only be a real problem if there were no options to buy phones direct/outright without the lock. Instead, we’re likely to end up in some situation where carriers work with phone manufacturers to implement a sort of higher-level device lock feature that stipulates the device “belongs” to the carrier and can be functionally locked (a la the stolen device lock features that currently exist) if they ever go unpaid.

deleted 2y ago

[deleted]

jjmarr 2y ago

What happens when the buyer says "no, I'm not paying" and sells the phone? Instant money. Meanwhile the telecom company has to sell the debt at a massive discount to a collections agency or spend a ton of money collecting on it. That's assuming it can be collected on at all from someone that might just be running a scam. With a locked phone, the phone just stops working and loses most of its value. A rule forcing carriers to unlock phones after the term is up is fine. Forcing them to do it before is illogical. How many people are going to pay for two plans on one phone because they didn't like the first plan? I doubt it's more than those who will immediately abuse this rule and stop paying for the phone. I don't see the benefit to society here.

seabass-labrax 2y ago
Being able to use a second carrier without cancelling a contract with the first is useful for international travel; the 'roaming' rate is often much higher than the normal rate of other countries' local telcos. Plus, mixing-and-matching plans can be advantageous to the user in certain situations even within one country. For example, data-only plans are typically cheaper than data+calls, but one might still want a very modest calls plan for infrequent use - sometimes, better value can be attained by combining two separate contracts. Of course, whether or not telcos ought to allow such use of their contract handsets is another question entirely!
- neodymiumphish 2y ago
  If there’s a big enough market for this use case, I suspect at least one carrier would do so. I’d imagine this would include some sort of payment in escrow, temporary unlock feature, or an optional add-on. Otherwise, folks in this position should just buy the phone outright and unlocked so they don’t have any issues like you’re describing.
__MatrixMan__ 2y ago
The carriers getting screwed is the point here. The sooner their anticompetitive behavior backfires on them the sooner they'll stop doing it.
2y ago