By Aldo Paneesidi
Managing Customer churn as well acquiring new customers is an ongoing problem for all carriers... as such, they make it difficult for customers to switch providers. To this end, practically all carriers worldwide engage in 'false highly-persuasive' advertising. They will typically lure consumers with the offer of FREE smartphone and then hook, reel and lock them in with long term service plans that are designed to not only subsidize the cost of the cell phone but provide wireless voice & data services at premium prices. To further enforce customer loyalty, carriers lock their giveaway phones to only work within their network frequencies - thus making it difficult for consumers to leave them for another carrier.
In some cases, the programming may be easy to reverse, with the user simply reformatting the cell phone or removing the phone's memory card. In other instances, the phone may be designed in such a way that it is impossible to use it with another network, with most cell phone brands, like Apple, Blackberry, Samsung, Nokia, Motorola, HTC, LG Mobile and Sony to name a few, manufacturing specific phones for particular networks.
In contrast, an unlocked phone are simply handsets that aren't handcuffed to a specific carrier's service package can be used on any network.
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Unlocking a phone - How it works
A cellphone handset is like a body without a brain. It can't make calls unless it has a thumbnail-sized chip called a SIM card installed. The SIM card identifies an individual phone on a cellular network so that calls can be routed to it as the handset is carried from place to place, so the owner's account can be billed for air time and long-distance fees, and so on.
When a phone is bought on a service plan, the SIM card in that phone is linked to the subscriber's ID information for billing. Most carriers lock the phone by programming its software so that it will only work with the SIM card they provide — try to swap it with a card from another carrier because it has a cheaper service plan, for example, and the phone won't recognize it.
An unlocked cellphone is one that will recognize any SIM card. So if you're travelling in Europe and don't want to incur roaming charges or have every local call billed as long distance by your regular North American cellphone carrier, you can buy a local European carrier's card during your stay and pop it into your regular phone.
The caveat is that there are two main cellphone networks, and they aren't compatible with one another. One is based on the CDMA standard, which is popular in North America and parts of Asia, and used by Bell and Telus in Canada. The other is GSM, which is used by Rogers in Canada and is the most common cellphone standard outside North America, used by more than 2 billion subscribers in most countries around the world.
An unlocked phone will work on a compatible network — CDMA phones on CDMA networks and GSM handsets on GSM networks. But many CDMA phones have the SIM card built in, and have to be reprogrammed directly to make the phone work on another carrier's network. Most GSM handsets, on the other hand, have a slot that allows a SIM card to be swapped easily by the user. As a result, unlocked cellphones available in Canada are predominantly GSM models.
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