Griffin's Tech Blog
Peter Griffin on the tech universe

Vodafone's mobile phone lock-down


There's been mounting criticism in the tech blogosphere of Vodafone's move to lock new mobile phones so they can only be used on the Vodafone New Zealand mobile network.

Vodafone will charge $50 to unlock new handsets if people want to shift to another provider here or use someone other than Vodafone overseas for mobile roaming.

Check out the robust discussion on Geekzone where Vodafone has been slammed for what many see as anti-competitive behaviour.

Aardvark chips in here and asks whether the move "could this be the best thing that's ever happened to the grey market phone business".

Parallel imported phones are sold unlocked so can be used on any network. Will Vodafone's lock-in push people away from Vodafone stores?

We've already effectively got lock-in in this country when it comes to mobile. Telecom's phone's don't have SIM cards and use the CDMA technology of which there is only one network - Telecom's (though TelstraClear now re-sell the service).

Vodafone has the only GSM network, but New Zealand Communications has built part of a network and even has some cell sites live.

It's no coincidence that Vodafone, after years of selling unlocked phones, is changing its policy as Telecom prepares to launch a GSM network and New Zealand Communications gets into the game as well.

It's speculated that NZC in particular will target Vodafone customers with cheap calling deals and urge them to bring their unlocked phones to the new NZC network. Telecom will be more focused on luring in converts with subsidised handsets procured through its new deal with global mobile phone distributor Brightstar.

Either way, Vodafone customers buying a new handset or people considering joining Vodafone need to be aware that they won't simply be able to pop out the SIM card and put in a rival operator's SIM card to get the alternative service. To allow that to happen you'll have to pay $50 (though I'm sure the geek community will soon have some easy unlocks widely available on the internet).

Vodafone's reasoning for the change is smirk-inducing at best: "This is being done to protect the customers' experience of the Vodafone brand. Vodafone brands its mobiles with both the Vodafone and Vodafone Live! look and feel. If a customers takes a Vodafone mobile to another network, the customer won't be able to access the Vodafone experience and services," said spokesman Paul Brislen.

But the reality is that this is the end of the good times for Vodafone mobile users in terms of having the freedom to roam overseas on other SIM cards to get cheaper local rates. Phone locking is widely practiced overseas where in the big markets there are as many as six operators competing using the same technology.

Phone locking is legal in most countries - apparently its banned by law in Belgium, but its common in the rest of Europe, Asia, the US and in Australia. Most operators charge a fee for having a phone unlocked. Vodafone Australia has a website for people wanting to unlock their phone


In places like Britain there's a bit of an underground market in unofficial mobile phone unlocking. You'll find people on the fringes of London's markets offering cheap and quick, though warranty-voiding, SIM unlocks.

Is phone locking fair? As some have pointed out, it seems reasonable that if you've received a subsidised handset as a result of signed up to a fixed term contract, say 24 months, its fair that you should be penalised for breaking that contract both in terms of early termination fees and an unlock fee.

But what about pre-pay users who generally get much less in the way of subsidies and people buying phones at full price? Those people have a right to be annoyed about having their phone locked and having to pay $50 just so they can take it elsewhere.

It's like Orcon or Ihug charging you to have your wireless router unlocked so you can move to another broadband provider. Anyway, I doubt the Commerce Commission will have a go at Vodafone over this, based on international experience.

So be warned. If you're travelling regularly and are used to buying pre-paid SIM cards overseas to cut down on calling charges while you are away make some careful decisions before you upgrade to a new phone. Your next handset may leave you locked out of the networks you've connected to in the past.

What do you think? Is this fair play for Vodafone or has the mobile operator crossed the line? Do you think it will hurt the company's handset sales? Anyone know any good SIM unlocks?



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