Consumer Watch – Changing carriers shouldn’t have to mean trashing old cell phone

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Philadelphia Inquirer

For the last six months, cell-phone customers in the nation’s largest markets have been able to keep their phone numbers when they switch carriers. By last month, when that right went nationwide, an estimated four million had made such a switch.

Almost all of them, though, had to discard something else they might have considered valuable: their wireless phones.

Isn’t it time for cell-phone companies to relax their hold on handsets that don’t need to be cast aside?

Some consumer advocates have been pressing that point. Since November, a campaign by Consumers Union has generated about 4,000 letters to federal regulators urging them to investigate carriers’ policies that prevent phones from becoming as portable as numbers.

This week, an organization in California took the campaign a step further. It filed a lawsuit in state court there against three national carriers that use compatible technology but routinely “lock” their phones to prevent them from being activated on competing systems.

The suit, filed by the Foundation for Taxpayer & Consumer Rights, accuses Cingular, AT&T Wireless and T-Mobile of using these phone locks – often nothing more than software that can be deactivated with a secret code – to thwart the purpose of the new number-portability rules.

Because of such locks, the group argues, dissatisfied customers face an extra barrier to switching.

Not only might they owe hundreds of dollars in early-termination fees if they decide to switch. They also must throw away handsets that can themselves still be worth hundreds of dollars, even if their original prices were heavily subsidized by the carriers when the customers signed up for new service.

Although none would comment directly on the lawsuit, the three carriers, who all use a wireless technology known as GSM, defend their handset-locking practices. Still, there are key differences among them that suggest some room for change.

AT&T Wireless – the only national carrier to report a drop in subscribers after number portability took effect – says it will never unlock one of its phones so it can be used on another service.

“We simply cannot afford to subsidize the phones unless they’re used on our own network,” company spokesman Marty Nee said.

Cingular, which expects to complete the purchase of AT&T Wireless by year’s end, is less adamant. It says it will unlock one of its phones if a customer has completed his or her contract and is in good standing.

T-Mobile doesn’t even make subscribers wait that long. It says that if a customer is up to date on bills, it will unlock one of its phones after 90 days.

If you can’t wait any amount, or if you’re an AT&T Wireless customer, there may be another option.

In the last several years, a handful of Web-based entrepreneurs have begun offering end runs around GSM handset locking. Yesterday, I checked in with one of them, David M. Rowell of Redmond, Wash., who publishes an electronic newsletter called the Travel Insider (www

What Rowell offers depends on your particular model of handset.

For most Nokia and some Samsung phones, he can sell you the actual unlocking code (a sequence of numbers you’ll key into the phone) for $5.

For most Sony Ericcson, Siemens or Motorola models, you’ll have to send your phone to Rowell for unlocking, for a fee of $25 by mail.

But some phones’ locks are impenetrable to Rowell. For example, he can unlock the Sony Ericsson T100, but not the T105. “The key variable is how much of the manufacturer’s secret locking code seeps out into the public domain,” he says.

Rowell got into the phone-unlocking business last November. Since then, he’s sold codes or unlocked phones for more than a thousand customers who tend to fall into three categories.

Some have completed their contracts and simply want to switch carriers without tossing a perfectly good phone – perhaps one they paid cash for to replace an aging giveaway.

Others have bought used phones cheaply – there’s a thriving market on eBay – and want to activate them with a different carrier, perhaps to replace a broken phone or to use a low-cost prepaid wireless plan.

Rowell, a New Zealand expatriate who travels frequently, is especially interested in the third group: travelers who want to use their phones more economically abroad.

Phones that use GSM technology, the dominant system in Europe, contain their phone numbers and other key data on a removable chip known as a SIM card. If the phone is otherwise compatible, a traveler with an unlocked phone can buy a prepaid SIM card, and save significantly on calling.

If a caller simply uses international roaming, calls from home can cost $2 to $5 a minute, Rowell says. With a European SIM card, incoming calls are likely to be free under European “calling-party-pays” rules, and outbound calls much cheaper, too.

You might be able to do the same thing, Rowell says, by buying a special unlocked “world phone” – at a much higher price.

But if you already have the technology in hand, why do wireless companies insist on locking it away?
Contact columnist Jeff Gelles at [email protected]

Consumer Watchdog
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