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Chile Forbids Carriers From Selling Network-Locked Phones

timothy posted more than 2 years ago | from the as-regulations-go-not-a-bad-idea dept.

Cellphones 291

An anonymous reader writes "As from today, network operators in Chile are no longer allowed to sell carrier-locked phones, and must unlock free of charge all devices already sold to costumers through a simple form on their respective websites. The new regulation came into effect in preparations for the rollout of Mobile Number Portability, set to begin on January 16th. This is one among other restrictions that forbid carriers to lock in the customers through 'abusive clauses' in their contracts, one of which was through selling locked devices. Now if a customer wishes to change carriers he/she needs only to have the bills up to date and the process of porting the number should only take 24 hours."

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An outbreak of common sense (5, Insightful)

Anonymous Coward | more than 2 years ago | (#38573146)

I applaud it.

Re:An outbreak of common sense (0, Offtopic)

InformativePost (2544774) | more than 2 years ago | (#38573386)

Yes, now if they only got rid of censoring Tienanmen and other bullshit..

Re:An outbreak of common sense (5, Funny)

Anonymous Coward | more than 2 years ago | (#38573462)

RTFA: Chile != China


Re:An outbreak of common sense (0)

Bucky24 (1943328) | more than 2 years ago | (#38573734)

Hell that's not even RTFA. That's a failure of basic geography...

Re:An outbreak of common sense (-1, Redundant)

jeffmeden (135043) | more than 2 years ago | (#38573964)

RTFA: Chile != China


I think you were looking for: ROFLMAO

oblig: []

Re:An outbreak of common sense (1)

A10Mechanic (1056868) | more than 2 years ago | (#38573528)

Well, isn't that special. Thanks, Church Lady!

Re:An outbreak of common sense (5, Insightful)

Anonymous Coward | more than 2 years ago | (#38573680)

You might be able to do this in the U.S, but first you would have to unlock all the paid-for federal politicians.

Based on the chances of that happening, I guess not.

Re:An outbreak of common sense (5, Informative)

GameboyRMH (1153867) | more than 2 years ago | (#38573706)

Chile has a lot of forward-thinking legislation on tech issues. Net neutrality is already legally enforced there.

Re:An outbreak of common sense (1, Insightful)

jadavis (473492) | more than 2 years ago | (#38573988)

"...and must unlock free of charge all devices already sold to costumers through a simple form on their respective websites."

You applaud retroactively changing private contracts? For extreme cases, it can be justified, but for cell phones?!

If a country treats private contracts this way, it discourages investment in a major way.

Great (3, Insightful)

dintech (998802) | more than 2 years ago | (#38573150)

This will increase competition between providers as consumers can move to the best deals a little bit more easily. Hopefully other countries will follow suit, but I doubt it.

Re:Great (1)

Anonymous Coward | more than 2 years ago | (#38573194)

if only this could happen in more capitalized countries, where lobbyists all have their corporate sponsors

Re:Great (5, Informative)

Anonymous Coward | more than 2 years ago | (#38573250)

Europe already has this, and has done since the beginning. You buy your phone and put in a SIM for your chosen network, if you want. You can even use PAYG SIMs that don't expire straight into the latest and greatest devices. Where people come unstuck is believing they're getting a "free" latest version iPhone/Nexus/Whatever when locking into a contract. You want choices? You ain't getting a "free" phone.

Re:Great (5, Informative)

daem0n1x (748565) | more than 2 years ago | (#38573644)

Not in my country, Portugal. Here, locked phones are the norm. Paradoxically, one of the earliest adopters of mobile phones and one of the countries in the world with more mobile phones per person.

The explosion of mobile phones in Portugal can in part be explained by locking. Being able to sell locked phones, the operators gave the phones almost for free and made money on calls. This made it possible for every cat and dog to buy a locked mobile phone really cheap. If calling between operators is too expensive, no problem. Buy more phones locked to the other operators.

Re:Great (1)

Carewolf (581105) | more than 2 years ago | (#38573872)

Selling locked phones might be the norm, but unlocking them should be perfectly legal if Portugal follows EU law (which I assume they do). In fact you can unlock GSM phones yourself if you know how.

Re:Great (3, Insightful)

Soluzar (1957050) | more than 2 years ago | (#38573228)

Customers will still be locked into a miminum of a 12 month contract if they are getting a handset at a subsidized price.

Re:Great (0)

Anonymous Coward | more than 2 years ago | (#38573376)

Makes sense to me though. The provider has to make up the difference somehow. Full price and no-term service or half-price with termed service.

Re:Great (1)

Soluzar (1957050) | more than 2 years ago | (#38573510)

Makes sense to me too. Just means you can't switch whenever you feel like it.

Re:Great (1)

Carewolf (581105) | more than 2 years ago | (#38573918)

Makes sense to me too. Just means you can't switch whenever you feel like it.

I don't think you understand. You CAN switch whenever you feel like it, but you might have to keep paying the old service minimum fee until the contract runs out, but the phone can always be changed to a different service.

Re:Great (1)

gl4ss (559668) | more than 2 years ago | (#38573458)

if someone insists on buying with partial payment, that's their problem. but buying on partial payment you can't measure is much worse than that - and that's what carrier locking and discounting is all about.

Re:Great (1)

Soluzar (1957050) | more than 2 years ago | (#38573538)

What exactly do you suggest can't be measured? I don't follow at all.

Re:Great (2)

Endo13 (1000782) | more than 2 years ago | (#38573714)

I believe he's saying you're still only making a "partial payment" on a locked phone, because the carrier expects to make up the rest of the payment from you paying for more service long-term. This then is the partial payment that really can't be measured.

Re:Great (1)

Anonymous Coward | more than 2 years ago | (#38573490)

No, the device and service billing will be separated. They use strategies such as giving you a discount on the device if you keep the service with them, but you can totally get the service from another company.

Re:Great (0)

Anonymous Coward | more than 2 years ago | (#38573622)

Well, it is ok to be locked into a contract for getting a handset at a subsidized price. But I never understood why it is legal to also lock this handset to this providers network.

Re:Great (1)

TyFoN (12980) | more than 2 years ago | (#38573238)

This is already the status in Norway where I live. That is, it's not illegal to sell locked phones but all of the carriers are using gsm and you can port your phone number to any provider you want free of charge. There are three national networks and about 50 providers that are piggybanking on the large ones as they can by law only charge the smaller providers for the actual cost of running the network. The result is a lot of cheep plans that do not involve buying a phone.
I don't think I have ever bought a provider locked phone and had no quarrels of moving to a new company before I started having my phone paid by my job.

Re:Great (1)

jellomizer (103300) | more than 2 years ago | (#38573332)

Competition is usually good.
However Private Industry is usually bad at managing Infrastructure.
Now this could (I am not saying it will... Just a possibility) hurt the customer, as the big names in the area loose a lot of their business and cannot afford to maintain their infrastructure. This will close a good portion of the backbone and with more competition but with smaller competitors none of them will have the resources to make a complete network. So while we can choose carriers based on price or performance. With more competition we could get a case where you need to pay more for service because neither company can scale to the size it really needs without more money, and the service could hinder as they cannot afford to have as many towers as you would like.

The Chilean government probably should need to to support the Cell Towers Infrastructure and equally divide the costs based on number of customers that each company has.

Re:Great (1)

CrackedButter (646746) | more than 2 years ago | (#38573516)

First it's 'lose' and not 'loose'.

Second other countries have solved this problem. Have one company take over and be responsible for the network infrastructure. BT do this in the UK with broadband and wireline. It's not a stretch for this to happen with wireless as well without a detrimental affect on the customer.

Re:Great (2)

Dog-Cow (21281) | more than 2 years ago | (#38573550)

Have you driven in most of the US (that gets varying weather)? Government is no better at infrastructure. The commonality to both is that they have priorities that do not include maintenance and upgrades.

Re:Great (1)

oh_my_080980980 (773867) | more than 2 years ago | (#38573816)

Yes I have, and yes the Government is good at infrastructure when you don't have jackasses cutting funding for maintaining it.

Re:Great (2, Insightful)

tmosley (996283) | more than 2 years ago | (#38573802)

Private industry is bad at managing infrastructure?

Then why are privately owned toll roads in such good repair? Why does our privately owned worldwide system of trade networks work so well? Why does the internet work so well? Why does cellphone service work so well? Why do private urgent package delivery services work so well?

Why are cable monopolies such shitty services? Why do electricity prices keep rising? Why does electricity flicker in a big city like Houston? Why did sewage used to back up into my house before I moved into the country? Why to public roads have potholes everywhere, and seem to always be under construction?

Oh, that's right, apologists for the state ignore all evidence when making their dumb theoretical assumptions.

Re:Great (0)

Anonymous Coward | more than 2 years ago | (#38573398)

...and that is exactly why it will not happen here.

Re:Great (0)

Kenja (541830) | more than 2 years ago | (#38573414)

No. It will drive most consumers out of the market as they can not afford the unsubsidized phones.

Re:Great (1)

polar red (215081) | more than 2 years ago | (#38573494)

sure. my unlocked phone has cost me about 30 € if my phone bill wouldn't be paid by my employer, it would cost me about 10-20 € ...

Re:Great (0)

Anonymous Coward | more than 2 years ago | (#38573694)

No, it won't.
They can still sell subsidized phone with term.
Just include the difference in the early termination penalty.
With locked phone, many carriers charge a stiff fee, or even refuse, to unlock the phone, even after the term is over.

Re:Great (1)

tmosley (996283) | more than 2 years ago | (#38573832)

Huh? Boost Mobile doesn't subsidize their phones, and there are plenty of models available for under $20. Hell, you can get a smartphone for $100.

Re:Great (2)

Artraze (600366) | more than 2 years ago | (#38573736)

Actually, it rather decreases it*. Whereas a carrier (like T-Mobile in the US) could compete with the ability to unlock phones, now all carriers are required to offer it thus eliminating that option as a difference between carriers. And while that isn't itself a bad thing (as either way the customer can get their phone unlocked), quite often these days carriers will add hidden costs as "compliance fees". So even though you can unlock your phone, instead of it being a feature, it's now a cost burden on you, and a regulation burden on the carrier and the government (who must have staff on either side to ensure compliance).

So, while this is kind of nice, the issue, as always, is that the consumer base is too uninterested / uninformed / lazy to really make it important point of competition and instead 'we' get more corporate/regulatory bloat. Woohoo?

*This does nothing about contracts (as well it should not!), so people are still "locked in" if they, well, choose to sign a contract.

Wow (5, Interesting)

Bert64 (520050) | more than 2 years ago | (#38573158)

Legislation which actually benefits consumers instead of large corporations, very good...

Locked cellphones are abusive and totally unnecessary, you already have existing contract laws to ensure that someone continues paying their bill for the duration of the contract term so there's really no reason to try and lock handsets too.

Re:Wow (5, Funny)

Anonymous Coward | more than 2 years ago | (#38573312)

Well, I'm glad THIS sort of blatantly anti-job-maker legislation won't ever happen in the good ol' US of A! You won't hear us clamoring for such a violation of corporate* rights and freedom!

*: Hallowed be their almighty names.

Re:Wow (3, Insightful)

Kenja (541830) | more than 2 years ago | (#38573472)

Unclear as to how forbidding consumers from being able to get a low cost cell phone in exchange for a carrier lock in is bad. Do you really think Chileans are going to pay the 400-600 USD an unlocked/unsubsidized phone costs? Guess what? You can buy an unlocked phone in the US right now. Apple sells them on their web site. The vast majority of people would rather pay less money for a locked phone.

Re:Wow (3, Informative)

polar red (215081) | more than 2 years ago | (#38573544)

The vast majority of people would rather pay less money for a locked phone.

... and pay the difference in their phone bill, because they can't count. Locking the phone does not make the phone magically cheaper !

Re:Wow (1)

Rising Ape (1620461) | more than 2 years ago | (#38573560)

How does the lockin stop a phone costing that much? It simply shifts the method of payment from an upfront cost to one spread over the length of a phone contract or more.

I assume you don't think we should still have to use a landline phone rented from the phone company rather than bought, do you?

Re:Wow (5, Informative)

frisket (149522) | more than 2 years ago | (#38573582)

Amazing how the population of the USA has been brainwashed into thinking that the carrier lock is in exchange for a low cost.

The low cost is in exchange for a term contract. The carrier lock is just US industry's 1950's mentality kicking in. In principle, it's very little different from the proprietary lock-in we see in software.

Re:Wow (2)

MXPS (1091249) | more than 2 years ago | (#38573746)

The biggest problem with the majority of the population is their infatuation with credit and paying for good later. A good amount of people live well above their means and buy luxury items they have no business owning. By spreading the payments over a long (2 year) term, people believe as if they can afford more than they could if they were pay the $400 upfront. We see this every day and the large corporations know exactly how to exploit this mentality and take advantage of the ignorance some people. We saw an extreme measure of this mentality bring this country basically down to its knees with the sub-prime lending disaster.

Re:Wow (2)

geek (5680) | more than 2 years ago | (#38573718)

I can buy an unlocked phone but it does not reduce the cost I pay monthly by one cent. If I buy a locked phone I get 400-500 off the price of the device and my monthly bill stays the same.

It doesn't take a genius to figure out which road to take here.

Re:Wow (2)

king neckbeard (1801738) | more than 2 years ago | (#38573942)

The costs are subsidized by a contract, not the phone being locked in If the phone isn't locked to a certain carrier, once that contract is over, the phone is useful on other carriers, so there's competition on your phone bill, which tends to bring it down lower.

Re:Wow (1)

HornWumpus (783565) | more than 2 years ago | (#38573954)

Yes it does. But you need to change to a prepaid plan and provider. In the USA you also need to worry about frequencies and compatibility.

$40/month unlimited talk/text/data.

Re:Wow (0)

zazzel (98233) | more than 2 years ago | (#38573982)

Actually, there is economic reason to lock customers' handsets to a certain network.

Providers want to attract customers by selling highly subsidised handsets. They can only do so if the subsidies will subsequently be paid back during the contract term. Now, we have two models: model a) high monthly cost, "usable" contract (unlimited airtime etc). Not a problem, the providers WILL get their money back. b) low fixed costs, high per minute charges. This is where a SIM- or netlocked phone becomes necessary. I know many people who will get one of these contracts, cash in the high subsidies (the phone), then unlock the phone and use it with *another* contract.

So, while I would never want to buy a sim- or netlocked phone, there IS a basic rationale for this kind of behaviour.

That being said: Were the Chilean companies abusing this possibility by locking in *every* handset sold? Here (Germany), providers are mandated to remove the SIM- or netlock free of charge after the contract has expired (usually 24months).

its about time (0, Redundant)

ganjadude (952775) | more than 2 years ago | (#38573170)

oh wait, this is chile, I almost thought for a second that we did something right here in the states, I should have known better.

Re:its about time (1)

toutankh (1544253) | more than 2 years ago | (#38573210)

Yeah, if only all western countries followed the example...

Re:its about time (1)

bernywork (57298) | more than 2 years ago | (#38573400)

In Europe and Australia, you are tied financially to the carrier. If after a week of a 12 or 18 month contract you want out, you can ask for them to unlock your phone and they will normally do it, you port away, they will give you a bill for the remainder of your contract.

Some carriers will ask that you pay the bill before the unlock (Change from monthly billing to pay as you go) but a lot of them will unlock first.

Re:its about time (1)

Plunky (929104) | more than 2 years ago | (#38573620)

Some carriers will ask that you pay the bill before the unlock (Change from monthly billing to pay as you go) but a lot of them will unlock first.

Since at any time during the contract the phone belongs to you then I don't really see why they should be allowed to lock it to their own network. If you want to use the phone with another network it is none of their business, surely? It's your phone after all and no matter what you do with it, you are committed to paying them the full monthly amount your contract states for the remaining contract duration or until you arrange to cancel it (this will likely involve a buy out, on their terms).

The network lock is gravy for them, since they can freely sting you for any extra calls you make outside your contract terms, and you have no easy way to avoid that. Further, since they have so much power that they are offering contracts with no way for you to negotiate the terms, it certainly makes sense that the government should prevent them from abusing it in this way.

Re:its about time (1)

Shinobi (19308) | more than 2 years ago | (#38573912)

Maybe in some european countries, but in Sweden, all phones except the iPhone(unless they've changed that, haven't really paid attention to it) are unlocked, meaning you don't have to pay or even make a phone call to have it unlocked, you just swap SIM and off you go. You're still tied to the contract to pay for the phone, but no need to unlock it.

Point in case, one of my phones is tied to a carriers contract, yet when I go abroad, I just buy a pre-paid SIM in that country and use that to call or surf without roaming charges.

Summing up, european countries aren't the same homogenous market that the US is.

Re:its about time (0)

Anonymous Coward | more than 2 years ago | (#38573932)

What if you want to unlock it without terminating your contract? I bought this phone, I should be able to lend it to a friend whose battery just died and still wants to use his own SIM.

Unlock iPhone? (0)

Anonymous Coward | more than 2 years ago | (#38573202)

Great news. Can someone unlocked a US-based iPhone in Chile?

Re:Unlock iPhone? (5, Interesting)

Miamicanes (730264) | more than 2 years ago | (#38573328)

> Can someone unlocked a US-based iPhone in Chile?

You'd be wasting your time, if the intent is to use it in the US.

A non-Sprint iPhone will never work on Sprint as a customer phone (but can roam on Sprint if your carrier has agreements with them). Sprint just won't allow it, period.

A non-Verizon iPhone will never do EVDO on Verizon, even if you can get it to limp along with CDMA2000 voice and 1xRTT.

A non-AT&T iPhone will almost certainly never do HSUPA on AT&T, and would almost certainly cost way more than just buying an AT&T iPhone.

In theory, an unlocked iPhone could be used with T-Mobile, but (drumroll, please) will never do anything better than EDGE. There's no hard technical reason why an AT&T, Sprint, or Verizon iPhone can't do 1700/2100 HSPA+ on T-Mobile (their MSM6600 chipset is certainly capable of it), but an an end user you'll never, ever get it to work because the radio firmware is separate, with its own heavily-encrypted bootloader, and no iPhone sold anywhere on earth has 1700/2100 HSPA+ enabled in its radio modem firmware.

It's sad. Apple basically has one hardware design for all of its iPhones, but the three US models are intentionally as non-interoperable with each others' networks as their firmware can make them be.

Re:Unlock iPhone? (4, Informative)

Miamicanes (730264) | more than 2 years ago | (#38573460)

Just to add, even if a US judge were to block carrier SIM-locking, it would be almost meaningless in the US due to the way Sprint, Verizon, T-Mobile, and AT&T run.

Sprint's network will literally refuse to talk to a phone that attempts to identify itself as a subscriber phone with a MEID that isn't in Sprint's official database of Sprint-branded phones.

Verizon authenticates EVDO via firmware extensions that don't exist in Sprint phones, so Verizon's network will refuse to negotiate EVDO connections with a theoretically-unlocked Sprint phone.

T-Mobile's frequency bands aren't supported by default in most GSM phones (most new chipsets can do them, but few phones have support for 1700MHz uplinks enabled, the Samsung Galaxy S i9000 sold internationally is one of the very, very few exceptions).

Most European phones can roam on AT&T, but AFAIK, HSUPA is a semi-proprietary extension to UMTS that's mostly unique to AT&T and not used in Europe(?), so even European phones capable of doing 3G on AT&T will be limping along at less than the max data rate (not 100% sure about this one, but I've seen it widely reported that only AT&T-branded phones can achieve the maximum HSUPA data rates)

Re:Unlock iPhone? (0)

Anonymous Coward | more than 2 years ago | (#38573710)

they don't want costumers? I can see why a provider would try to make it difficult to use a phone they helped pay on some one elses network, but trying to
prevent phones that some one else helped paid for to get on the network just doesn't make sense

Re:Unlock iPhone? (0)

Anonymous Coward | more than 2 years ago | (#38573904)

I hate when people in costumes show up.

Re:Unlock iPhone? (1)

spire3661 (1038968) | more than 2 years ago | (#38573876)

Your post clearly precludes any iphone 4S information which has all the radios to be a 'world phone'. Verizon requires a 60 day cooling period before you can unlock the micro-sim in the 4S, but im sure you could get it rushed if needed. Other then that there is nothing stopping you from popping a micro-sim in it and start calling right away.

P.S. ON 4G Sprint CANNOT refuse your device in the US, in theory at least.

Re:Unlock iPhone? (1)

flaming error (1041742) | more than 2 years ago | (#38573392)

Yes. I'm sure somebody can.

If you meant to ask if AT&T will follow this Chilean law, then I'd say you'd sooner get Disney to endorse the Pirate Party.

Refreshing (1)

jimmerz28 (1928616) | more than 2 years ago | (#38573204)

Nice to see a positive South American headline.

It must be nice having a small(er) country where you can pass progressive pro-consumer legislation.

Re:Refreshing (1)

GameboyRMH (1153867) | more than 2 years ago | (#38573810)

Chile some time ago surpassed New Zealand on my "potential nice place to live" list. Too bad about their Internet censorship, NZ's techie/gearhead culture is really appealing.

The deciding factor (1)

Anonymous Coward | more than 2 years ago | (#38573214)

Well that settles it. Once Trump and Palin win in 2016 I'm expatriating to Chile. No poisonous snakes either!

Luckily Chile isn't in the EU (4, Informative)

itsme1234 (199680) | more than 2 years ago | (#38573216)

.. otherwise the law might have been struck as "unfair": []
Yes, you read this right, forcing your provider not to lock your phone is "unfair" in the EU.

Re:Luckily Chile isn't in the EU (1)

Anonymous Coward | more than 2 years ago | (#38573506)

Gosh... one single, out of context wikipedia entry about Belgium certainly shows that the EU has terrible phone laws! If you actually knew what you were talking about, you'd realize that the EU has had the exact same kind of law forcing carriers to allow unlocking FOR FREE and allow users to port their phone numbers with minimal hassle for many years now.

I am from the EU (Netherlands) and the carriers are obligated, by law, to allow unlocking of their locked phones (yes - they ARE allowed to sell them bundled and locked, which might be just what that Belgium quote is about). I'm not sure on the details, but I think the rule was that the phone has to be at least a year old.

I moved to Canada and didn't feel like getting ripped off more than I absolutely needed to, so I spent all of two minutes getting the unlock code of my two old phones via the Dutch T-Mobile website so I could use 'em with one of the big telecoms here.

Re:Luckily Chile isn't in the EU (1)

itsme1234 (199680) | more than 2 years ago | (#38573670)

Can you please quote this elusive EU law that's "forcing carriers to allow unlocking FOR FREE" ? Please note that "after 1,2,5,50,500 years" doesn't qualify as "FREE" anymore as even popular expensive smartphones tend to be "left behind" after about one year or so nowadays.
Because the countries are so small and close you might want to go to Germany tomorrow (for one day, one week or one month) and use (for example) a cheap local SIM for data with YOUR phone. And you can't (and the fact that your provider might unlock your phone after 245 days doesn't help you a bit).

Not only I find hard to believe that this "EU law" exists but I'm not aware of ANY EU country that has a local law that either forces the providers to sell unlocked phones or forces them to unlock the phones for free without further qualification. Wikipedia seems to be agree with me as well.

Re:Luckily Chile isn't in the EU (1)

frn123 (242374) | more than 2 years ago | (#38573806)

Depends on the EU you are talking about.

For example in Estonia, it is forbidden to sell locked phones. All phones work on all networks. And phone numbers are transferable to other networks for free.

Re:Luckily Chile isn't in the EU (1)

itsme1234 (199680) | more than 2 years ago | (#38573926)

Would you care to edit the relevant parts from [] ?
They list only Israel and Singapore as countries banning simlocked phones; I'm sure somebody will add Chile but probably won't think/won't find the relevant "citation needed" to add Estonia as well.

A good law, except (1)

mehrotra.akash (1539473) | more than 2 years ago | (#38573222)

must unlock free of charge all devices already sold to costumers through a simple form on their respective websites

When the phones were sold, the carriers would have used the future earnings from these phones to offset the initial discount.
Now they cannot make that money
Somewhat unfair isnt it?

Re:A good law, except (2, Insightful)

itsme1234 (199680) | more than 2 years ago | (#38573406)

Any unexpected (and everything is unexpected at some point) regulation is "somewhat unfair"; the provider might bet on you staying with them after you finished your contract because you don't want to lose your number but then number portability comes and then they can't keep you.
Fact is the provider is intentionally crippling a perfectly good phone betting there will be enough people paying for their "official" unlocking service to offset all the costs associated with these procedures and even get them some extra profit.
It's a non-zero sum game in which the "total" optimal strategy would be for the provider to just stop messing up with the phones. The problem is that market will not reach this point by itself once those 2-3 big providers sell only locked phones.

Re:A good law, except (2, Interesting)

TheCarp (96830) | more than 2 years ago | (#38573416)

Unfair? No. Unfair is selling someone a device, telling them that they own it, it belongs to them, and if it breaks, they must pay to replace it.... and while it can technically connect to any network, its restricted to only use one. If they own it...its theirs, its unfair to make them own it AND tell them they can't use it as they see fit. Period.

So yes, it makes this particular business model untenable. Thats not unfair, it was the model that was based on an unfair practice.

Re:A good law, except (4, Informative)

oddjob1244 (1179491) | more than 2 years ago | (#38573444)

When the phones were sold, the carriers would have used the future earnings from these phones to offset the initial discount. Now they cannot make that money Somewhat unfair isnt it?

You're still in a contract with the carrier so they get their subsidized money back. This just means when you're done with your contract you can take your phone with you to another carrier.

Re:A good law, except (1)

Sprouticus (1503545) | more than 2 years ago | (#38573502)

There is nothing to stop them from putting a cluase in the contract that forces you to pay some ammount for the phone if you cancel the contract early. It just prevents them form denying you the use of the phone you purchased on another provider.

Re:A good law, except (1)

Duhavid (677874) | more than 2 years ago | (#38573604)

They still have a contract, dont they?

Re:A good law, except (1)

Bert64 (520050) | more than 2 years ago | (#38573836)

You don't need locked handsets to do this, existing contract law requires that the consumer uphold their end of the contract, which usually involves paying for mobile service for a minimum period of 12 or 24 months at an inflated cost to cover the subsidy on the handset, or to pay an "early termination fee" which basically amounts to paying for the cost of the handset up in one go anyway.

There are many reasons someone may want unlocked phones, for instance:
To use a local simcard when travelling
To buy a phone for someone else, eg i know someone in particular who wanted to get a subsidised iphone on contract, give it to her grandson and continue using her old handset with the service for the duration of the contract (she has no use for any advanced features of a phone and cannot afford to purchase an iphone in one go but can easily afford the monthly cost for 2 years)...
To sell/pawn (locked phones aren't worth as much)

Costumers rejoice! (0, Troll)

Anonymous Coward | more than 2 years ago | (#38573236)

I am sure all the costumers are happy about this change as they will finally be able to manage all of their costumes on a device of their choice. I wonder how this change will affect the customers at large though!

Chile, technology leader of the region. (5, Interesting)

esquizoide (834082) | more than 2 years ago | (#38573242)

Since I was a boy, Chile has always been known for being a leader in telecoms in Southamerica. It seems now that we are also leading in matters of technology rights. We also have Net Neutrality [] by law, ISPs can't block content nor censor it. Traffic shaping is also forbiddin (although it is still in use, since the Net Neutrality law is new). Our Minister of Telecommunications have said that the next goal is more competition and better prices both for Internet en cell phone communications. Also, in topic to this article. We have 3 major cell phone providers, and there are 2 more providers in the way. We also have more cellphones than citizens (20 million cells, in contrast to 17 mill citizens).

Re:Chile, technology leader of the region. (2)

toolo (142169) | more than 2 years ago | (#38573404)

I've traveled there on business and agree. Very impressive low-cost for access infrastructure. It is good they are being heavy handed with the cellular carriers though - the prices for international roaming are robbery there and forces people onto VOIP if they are working temporarily in the country.

Re:Chile, technology leader of the region. (0)

Anonymous Coward | more than 2 years ago | (#38573518)

Sounds like Chile would be a great country to live in, except for this [] ...

Re:Chile, technology leader of the region. (1)

GameboyRMH (1153867) | more than 2 years ago | (#38573880)

An FTA with the US? Meh, not the end of the world.

tootsie roll anal (-1)

Anonymous Coward | more than 2 years ago | (#38573262)

ever shove a tootsie roll pop up into your rectum so it taps your prostate?

Same Here (1)

zzen (190880) | more than 2 years ago | (#38573274)

Over where I live (Czech Republic) I'm told it's been this way for several years now. Although even before that, the local Vodafone made a point of differentiating itself from competitors by selling only unlocked phones. Their position was always "our service is so much better that we don't need to lock you in".

I wouldn't be surprised if this was the case in a lot of the EU countries (or if it were an EU-wide directive shortly).

The end of subsidised handsets. (0)

Anonymous Coward | more than 2 years ago | (#38573304)

That means carriers will no longer want to give you a handset "free" (for but a small premium on your contract), so you'll have to buy one or bring your own. Personally I have no problem with this, but it does change the dynamic somewhat. Let's see what happens.

Re:The end of subsidised handsets. (1)

kjc197 (235890) | more than 2 years ago | (#38573410)

I disagree,

The subsidy is clawed back by the providers by (length of the contract) x (price per month). Surely it would not make a difference to the subscription income during the course of the contract, as the monthly bills are mandatory.

What it will affect is attrition after the contract finishes. With no network lock, changing providor is just a sim card away, also could affect roaming charges, if consumers opt for a local PAYG sim when on their hols/business trips.

Better link available. (0)

Lashat (1041424) | more than 2 years ago | (#38573374)

I know that reading TFA flys in the face of /. reason. However, links to Twitter feeds, while verified as "subtel", are not really great story references.

Here is the English translation
"EYE From today cellular phones # # Chile must be sold unlocked. If stock is locked need to unlock your company at no cost"

Sadly, this is the best link I could find with a basic internet search. []

Any other sources out there on this topic?

This might be explained... (1)

vikingpower (768921) | more than 2 years ago | (#38573388) Chile having a successful history of doing away with dictators....

Re:This might be explained... (0)

Anonymous Coward | more than 2 years ago | (#38573962)

... after having them foisted upon them by [answer left as an exercise for the reader].

Yay for chile! (1)

gl4ss (559668) | more than 2 years ago | (#38573408)

cheap phones, cheaper calls, cheaper data and operators have to compete with quality too.

I really, really wish they hadn't allowed operator locking for 3g phones in Finland. it had shit to nothing impact on 3g adaptation.

Free as in...? (1)

erroneus (253617) | more than 2 years ago | (#38573840)

Okay, we say "free as in freedom" and "free as in beer." Can we now say "free as in Chile" and "free as in chilli"?

Carrier Subsidy (1)

stu72 (96650) | more than 2 years ago | (#38573420)

I agree with this 100% but I hope everyone realizes that with no ability to force customers to stick around, there will be a dramatically reduced incentive for carriers to offer subsidies on fancy phones. I think this is fine but I wonder if there will be an uproar when $600 iPhones cost $600 instead of $200 + contract and/or lock.

Re:Carrier Subsidy (1)

ZorinLynx (31751) | more than 2 years ago | (#38573486)

This is what ETFs are for. If the customer doesn't stick around, they have to pay $200+ to cover the subsidy that was given to them on their phone. There is no reason to lock phones at all because of this.

No matter what happens, the carrier will get paid back for the subsidy.

Re:Carrier Subsidy (1)

nine932038 (1934132) | more than 2 years ago | (#38573520)

Curiously enough, this didn't stop South Korean telecom companies. When I was living there, I was able to move my phone from company to company without a problem, even with a smartphone plus subsidy. The only limit was that I could only move my phone sixty after signing the initial contract.

I assume that the new company simply bought the phone contract from the old company outright, and simply continued on the same terms with the client.

Re:Carrier Subsidy (1)

fuzznutz (789413) | more than 2 years ago | (#38573762)

And when demand drops for those $600 phones as customers have to pay the upfront cost, maybe the prices will drop accordingly. I would personally love to see a system where cell companies could not sell/profit on the handsets themselves. Service and handset costs might hit a "normal" equilibrium where tightwads can buy a cheap phone and get inexpensive service, while gadget freaks can buy their latest iPhone and pay for monthly service, not a mortgage on the phone.

Re:Carrier Subsidy (1, Insightful)

erroneus (253617) | more than 2 years ago | (#38573866)

Phones don't cost $600 and Windows doesn't cost $300. Just because party X "charges" Y for something in 'retail' things doesn't mean it's worth it or that anyone actually pays that much let alone "costs" that much to make.

Re:Carrier Subsidy (3, Insightful)

geek (5680) | more than 2 years ago | (#38573914)

Exactly. An Unlocked iPhone 4S costs more than an iPad 2. There is no reason for the unlocked phone to cost what it does. The price is artificially inflated to make it look like you are getting a huge amount off in subsidy.

More government interference! (4, Funny)

cvtan (752695) | more than 2 years ago | (#38573660)

If you people would just leave cell phone companies alone, they would naturally all do the right thing by their customers!!!

Re:More government interference! (1)

erroneus (253617) | more than 2 years ago | (#38573814)

You forgot the "sarcasm" tag didn't you...

The race to the bottom seems to pay off quicker and better than the race to the top.

Re:More government interference! (0)

Anonymous Coward | more than 2 years ago | (#38573960)

No, they won't. Because there cannot be enough competition!
Cell phone service is not really a free market, because wireless spectrum is limited and needs to be granted by the government.
Besides, the initial cost to enter the business is high. (e.g. deploying towers)

I may buy my next phone from Chile (1)

erroneus (253617) | more than 2 years ago | (#38573752)

I wonder if I can get phones that work with TMobile-USA's network from Chile. Seems like the best way to buy a new phone.

Same here (1)

Anonymous Coward | more than 2 years ago | (#38573928)

I'm in Israel, and we have the same law - no network locking.

Our Operators are also not allowed to charge "exit fees" if you terminate the plan early, and if you terminate your data/calls contract but want to keep your phone (and finish paying for it according to the original contract) the operator can't prevent that either.

Oh yeah, and starting from this year, using "fine print" in advertising material is a crime! I love this country :)

In the original spanish this is known as... (2)

Karl Cocknozzle (514413) | more than 2 years ago | (#38573994)

"Con carne" communications laws.

Yum! Make mine with cheddar and onions, please!

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