Carriers Weigh in on FCC's Proposed Phone Unlocking Rule
Oct 22, 2024, 9:39 AM by Rich Brome @richbrome
T-Mobile and AT&T have submitted formal objections to the FCC over its proposed rule requiring carriers to unlock new phones after 60 days, regardless of whether the phone is fully paid off. (This type of unlocking would let customers use their phone with a different network.) T-Mobile and AT&T argue that — for their prepaid brands in particular — longer locking periods are necessary to ensure that phone subsidies are recovered. Prepaid phones sold by Metro by T-Mobile and Cricket (an AT&T brand) are typically subsidized so they can be sold far below their actual retail price. For example, Metro currently offers the Samsung Galaxy A15 5G — A $200 phone — for free. Metro currently locks phones for a full year to ensure the phone subsidy is recovered in monthly service charges. T-Mobile says that the FCC's proposed 60-day rule "would see subsidies reduced by 40% to 70% for both its lower and higher-end devices", and that a "handset unlocking mandate would also leave providers little choice but to limit their handset offers to lower cost and often lesser performing handsets." AT&T agrees, saying the proposed rule would create "upward pressure on handset prices and disincentives to finance handsets on flexible terms." Verizon is already subject to stricter phone unlocking rules as a condition of its FCC license for band 13, a core frequency band for its network. Verizon therefore voiced its support for the new rule, since it would create "a uniform unlocking policy that applies to all providers", effectively ending Verizon's current competitive disadvantage. However Verizon still acknowledged the need for longer locking periods in the prepaid market, saying "a longer, 180-day locking period for prepaid is necessary to enable wireless providers to continue offering subsidies that make phones affordable".
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