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A contract for 12/24 months of service has nothing to do with ownership of the phone. If you paid for it, it's yours.

mokus 14y ago
That's exactly the point. You didn't pay for it until you gave them their 12/24 months of service fees (or early-termination fee).
- pasbesoin 14y ago
  An argument against this has been that, regardless of the phone's status -- locked or unlocked -- you are bound by the terms of the contract you entered. Specifically, you are still paying the monthly fee and so paying off the subsidy on the phone (one can argue, although a true, cost-based accounting argument might have you paying off that subsidy in a smaller subset of the initial months). What unlocking then provides, is the ability to escape onerous terms and fees for additional service, such as roaming fees when traveling outside of the normal service area. If, with a GSM model, for example, you can pop in a different SIM under those circumstances, should you be able to? Given some the the shenanigans that have occurred in this industry, including outsized roaming fees, I tend to be in favor of saying "yes", to this. Or, put it this way: Competition's good. Even, or especially, within the term of rather long (with respect to technical and economic developments within the telecommunications industry) two year contracts. If, with a bit of effort and trouble, you can escape absurd roaming fees, new data cap restrictions, et al. Then, perhaps, your current, contracted carrier will feel more incentive to compete with reasonable terms and pricing.
- betterunix 14y ago
  This is like claiming that you did not pay for your milk unless you also purchased other groceries when your local supermarket uses a loss-leader strategy.
  - anigbrowl 14y ago
    No it's not the same at all. The ads say '$199 with contract.' And the fine print always explains you have to enter into a 2 year contract with the cell service provider, and that said contract will make you liable for early termination fees etc. if you try to skip out of it. For the last decade I've bought my phones unlocked and subscribed to a monthly plan that I can leave at any time. That means paying full price for the phone at the time of purchase, which is a lot more than the discount prices used to tempt you into a contract. Look, just because it's in your pocket and you get to use it as soon as you leave the store does not mean you own it.
    - betterunix 14y ago
      "Look, just because it's in your pocket and you get to use it as soon as you leave the store does not mean you own it." So who owns it? When last I checked, there was no line of credit, I am allowed to sell the phone to someone else without informing the carrier, and I am responsible for repairing any damage or replacing the phone if it is rendered non-functional. It sounds like I paid the carrier's price, signed a contract, and then owned the phone (while being locked into a contract). There is more to this than just the carrier's contract. Let's say I travel to another country, and I want to pay for a phone plan there so that I do not have to pay roaming charges. I'll need to unlock my phone to do that...and now by law I cannot (at least not here in America). For that matter, suppose I am here in America and I want to have two contracts with two different carriers on the same phone...once again, the law stops me. This is, plain and simple, a law that protects the carriers' business model in ways that other businesses are not protected. Don't fall into the trap of thinking that the free market is relevant here. It is not a free market when some players get special privileges and protections not available to other players. Cell phone companies get lots of special privileges, and this is just one more to add to that list.
      - anigbrowl 14y ago
        Why don't you read your contract and pay particular attention to the bit where it talks about transfer of title? As someone who doesn't sign these kinds of contracts and hasn't for years, I'm not sure what the exact position of the carrier is without downloading and analyzing a phone contract, which I don't feel like doing right now. The differences from leasing a car are for obvious reasons. If you don't make the payments on a car, a repo guy comes along and takes your car away. Bit difficult to do that on a phone, so they hit you with an early termination fee instead and you agree to it as part of the contract terms. Don't fall into the trap of thinking that the free market is relevant here. It is not a free market when some players get special privileges and protections not available to other players. Cell phone companies get lots of special privileges, and this is just one more to add to that list. I didn't mention the free market, but since you bring it up, the players within the phone industry have similar privileges. Saying that they get different privileges from, say, auto retailers is pointless, because they're not int he same market. Although I'm no fan of the major cell companies, I could point out that they also bear the burden of paying billions up front for lease of spectrum, whereas manufacturers of cars just have to get the thing running and into the hands of the would-be driver, who then pays over time for road use through taxes on fuel etc. You want to unlock the phone overseas, then do it overseas where you won't be subject to US law. You want to have two contracts on the same phone, the second one is going to be month-to-month by definition because the second carrier has no property interest in the phone. you can easily get out of your contract by paying the ETF. As I said elsewhere, I don't like these contractual provisions either, which is why I don't enter into such contracts. I do own my own phone, because I paid for it. This is what people in other parts of the world do, because the rock-bottom prices (with contract!) are not on offer in most other parts of the world.
anigbrowl 14y ago
But you haven't paid for it. You've typically paid for about 1/3 of it, and agreed to a contract which specifies a 2-year payment schedule for rest as part of your phone bill.
- amalcon 14y ago
  Yes you have. You "paid for it" when you signed the contract, to which you are obligated regardless of what happens to your phone. A mobile phone contract is not a loan; the phone is not collateral. You can't choose to give back your phone in lieu of an early termination fee.
  - anigbrowl 14y ago
    And the early termination fee is prorated to the outstanding term of your contract. The difference from (say) a car lease simply reflects the difficulty of repossessing your phone. Meanwhile, if you get tired of the contract, you just breach it and pay the ETF. then you can unlock your phone immediately.
    - amalcon 14y ago
      No; the difference from (say) a car loan reflects the fact that there's no lien created on the phone. That in turn may be because such a lien would be unenforceable. Still, the reason there's no lien is not relevant. Its absence is relevant.
      - Amadou 14y ago
        What you are talking about is a secured loan. There all kinds of loans which are not secured - like credit cards.
        amalcon 14y ago
        Sure. Of course, a credit card doesn't restrict what you do with things you buy with it.

mokus 14y ago

That's exactly the point. You didn't pay for it until you gave them their 12/24 months of service fees (or early-termination fee).

pasbesoin 14y ago
An argument against this has been that, regardless of the phone's status -- locked or unlocked -- you are bound by the terms of the contract you entered. Specifically, you are still paying the monthly fee and so paying off the subsidy on the phone (one can argue, although a true, cost-based accounting argument might have you paying off that subsidy in a smaller subset of the initial months). What unlocking then provides, is the ability to escape onerous terms and fees for additional service, such as roaming fees when traveling outside of the normal service area. If, with a GSM model, for example, you can pop in a different SIM under those circumstances, should you be able to? Given some the the shenanigans that have occurred in this industry, including outsized roaming fees, I tend to be in favor of saying "yes", to this. Or, put it this way: Competition's good. Even, or especially, within the term of rather long (with respect to technical and economic developments within the telecommunications industry) two year contracts. If, with a bit of effort and trouble, you can escape absurd roaming fees, new data cap restrictions, et al. Then, perhaps, your current, contracted carrier will feel more incentive to compete with reasonable terms and pricing.
betterunix 14y ago
This is like claiming that you did not pay for your milk unless you also purchased other groceries when your local supermarket uses a loss-leader strategy.
- anigbrowl 14y ago
  No it's not the same at all. The ads say '$199 with contract.' And the fine print always explains you have to enter into a 2 year contract with the cell service provider, and that said contract will make you liable for early termination fees etc. if you try to skip out of it. For the last decade I've bought my phones unlocked and subscribed to a monthly plan that I can leave at any time. That means paying full price for the phone at the time of purchase, which is a lot more than the discount prices used to tempt you into a contract. Look, just because it's in your pocket and you get to use it as soon as you leave the store does not mean you own it.
  - betterunix 14y ago
    "Look, just because it's in your pocket and you get to use it as soon as you leave the store does not mean you own it." So who owns it? When last I checked, there was no line of credit, I am allowed to sell the phone to someone else without informing the carrier, and I am responsible for repairing any damage or replacing the phone if it is rendered non-functional. It sounds like I paid the carrier's price, signed a contract, and then owned the phone (while being locked into a contract). There is more to this than just the carrier's contract. Let's say I travel to another country, and I want to pay for a phone plan there so that I do not have to pay roaming charges. I'll need to unlock my phone to do that...and now by law I cannot (at least not here in America). For that matter, suppose I am here in America and I want to have two contracts with two different carriers on the same phone...once again, the law stops me. This is, plain and simple, a law that protects the carriers' business model in ways that other businesses are not protected. Don't fall into the trap of thinking that the free market is relevant here. It is not a free market when some players get special privileges and protections not available to other players. Cell phone companies get lots of special privileges, and this is just one more to add to that list.
    - anigbrowl 14y ago
      Why don't you read your contract and pay particular attention to the bit where it talks about transfer of title? As someone who doesn't sign these kinds of contracts and hasn't for years, I'm not sure what the exact position of the carrier is without downloading and analyzing a phone contract, which I don't feel like doing right now. The differences from leasing a car are for obvious reasons. If you don't make the payments on a car, a repo guy comes along and takes your car away. Bit difficult to do that on a phone, so they hit you with an early termination fee instead and you agree to it as part of the contract terms. Don't fall into the trap of thinking that the free market is relevant here. It is not a free market when some players get special privileges and protections not available to other players. Cell phone companies get lots of special privileges, and this is just one more to add to that list. I didn't mention the free market, but since you bring it up, the players within the phone industry have similar privileges. Saying that they get different privileges from, say, auto retailers is pointless, because they're not int he same market. Although I'm no fan of the major cell companies, I could point out that they also bear the burden of paying billions up front for lease of spectrum, whereas manufacturers of cars just have to get the thing running and into the hands of the would-be driver, who then pays over time for road use through taxes on fuel etc. You want to unlock the phone overseas, then do it overseas where you won't be subject to US law. You want to have two contracts on the same phone, the second one is going to be month-to-month by definition because the second carrier has no property interest in the phone. you can easily get out of your contract by paying the ETF. As I said elsewhere, I don't like these contractual provisions either, which is why I don't enter into such contracts. I do own my own phone, because I paid for it. This is what people in other parts of the world do, because the rock-bottom prices (with contract!) are not on offer in most other parts of the world.

anigbrowl 14y ago

But you haven't paid for it. You've typically paid for about 1/3 of it, and agreed to a contract which specifies a 2-year payment schedule for rest as part of your phone bill.

amalcon 14y ago
Yes you have. You "paid for it" when you signed the contract, to which you are obligated regardless of what happens to your phone. A mobile phone contract is not a loan; the phone is not collateral. You can't choose to give back your phone in lieu of an early termination fee.
- anigbrowl 14y ago
  And the early termination fee is prorated to the outstanding term of your contract. The difference from (say) a car lease simply reflects the difficulty of repossessing your phone. Meanwhile, if you get tired of the contract, you just breach it and pay the ETF. then you can unlock your phone immediately.
  - amalcon 14y ago
    No; the difference from (say) a car loan reflects the fact that there's no lien created on the phone. That in turn may be because such a lien would be unenforceable. Still, the reason there's no lien is not relevant. Its absence is relevant.
    - Amadou 14y ago
      What you are talking about is a secured loan. There all kinds of loans which are not secured - like credit cards.
      - amalcon 14y ago
        Sure. Of course, a credit card doesn't restrict what you do with things you buy with it.