Why Phone Carriers Opt to Lock their Phones and Subsidize Prices

The Samsung Galaxy S5. This is the latest flagship from the giant Android smartphone maker that is a tingling agglomerate of hardware and software. At Amazon, you will get a black 16GB variant for as low as $99 – if you agree to sign a binding contract with AT&T. On the other hand, if you want to be a free bird and use any network you please, you will have to pay no less than $650 to own this gadget.

The price difference is because the carrier (AT&T) accepted to foot some bit of the bill with hopes of recovering the money and perhaps a profit if buyers agree to using its carrier services for as long as the contract is valid.

Locked to Keep You Loyal

A locked phone will not only have custom logos and special ringtones. It also gives the carrier the power to deploy specific services and bans you from using the services of its competitor regardless of how cheap or desirable they might be.

By using the lucratively cheap phone as bait, the carrier is sure of getting customers for the deal. Since the manufacturer would have made it impossible for the phone to work on another carrier and jailbreaking a phone will void its warranty.

Why You Might Need the Locked Phone

For people who rare travel out of the country, think that the specific carrier signal is strong enough and have no issues with the carrier charges, then going for a contract phone deal is quite a deal. You will save a lot of money and still get all the performance you have always desired. You will be happy – and so will be your carrier.

What You Would Miss out on

On the other hand, taking the deal without thinking things through will leave you open to a couple of exploits.


You will not be able to swap SIM cards on the go and use whatever carrier you desire. To travelers, this would mean a lot of money on roaming charges and sometimes no signal at all. With an unlocked phone, all you have to do is buy that other carrier SIM card and do the swap whenever you feel like.

App Installation Limitations

Even though the official App Store, Google Play and Windows Phone Marketplace has quite an impressive array of applications, you might sometimes want to grab an app off another place. Whilst an open phone will let you install apps from other sources, a locked phone only works with your official application vendor. Since most of the vendors will only give you access to applications optimized for your region, you can only imagine the much you would be missing.

Resell Value

So, what happens when you want to lay hands on the S6, or iPhone 6. Will you keep your current S5 and look for the money to foot the bill for your new phone or would you rather sell the S5 to get some of the cash you need for the transaction? If your answer is yes, the locked phones are a no go zone to you. Locked phones tend to have a very low resell value since very few second-hand buyers are willing to enter into crippling carrier contracts.


If you are comfortable with the carrier and are not that adventurous, then a locked phone will do. However, if you are ever curious and seldom settle for one thing or at a specific place, footing the bill gap is always a better idea.



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