Cell Phone Locks:
Frequently Asked Questions

What's does a cell phone "lock" mean?
Why do mobile phone companies lock their phones?
Why make mobile phone companies tell their customers that their phones are locked?
Isn't it illegal to unlock your cell phone?
Can't consumers unlock their phones themselves?
Can't Canadians already get unlocked phones?
Won't this cause fees to increase?
How can cell phones be unlocked?
Why is it harder to sell used cell phones in Canada?
What issues are there with unlocked cell phones?
What do all these acronyms like SIM and GSM mean?
Do new entrants into the Canadian market intend to lock their phones?

Sometimes called a "network lock" or a "SIM lock", this is a function of GSM mobile phones used to restrict handsets to work in specific countries and with specific network providers only. Thus, a locked Telus phone cannot be used on the Rogers or Bell wireless network, for example, even if the Telus customer is off-contract. Network locks are becoming more relevant now becuase of new entrants into the Canadian marketplace that may offer desireable service packages, and because Canada's non-GSM companies (notably Bell and Telus) have recently begun selling HSPA phones, that are effectively locked like GSM phones are.

Locks do two things for a mobile phone company:

1. It provides a means for them to recover the subsidy on a phone. Phones are often sold at or below cost to a customer when the company is comfortable they will make up the subsidy from that customer over time. Customers can't get a subsidized phone and then buy monthly service from a different company (for instance, purchase at cost from WIND but use on another network).
2. The lock makes it more difficult for consumers to use the phone on a different network. Not only does a customer need to port their number, they also need to get a new phone (or find some way to unlock the phone they have). Unfortunately, this limitation of consumer choice restricts competition - something the Canadian marketplace desperately needs. This also means that Canadians travleling with locked phones overseas are forced to incur international roaming charges, instead of switching to a local provider for the trip.

Many Canadians don't even know about cell phone network locks: they go in to a store, pick a phone they like, then buy it on a contract. They don't realise that when the contract ends, they are not free to jump to another carrier with their phone without unlocking their phone first, and most have no idea how or how much that costs. This artificially limits competition and is the reason why many countries, such as France, Finland, and Italy require that mobile phone companies inform their customers if the company has locked their phones.

No, Canadian law allows unlocking mobile phones, as is the case in most countries. Often this confusion comes about because in the USA, when legislation called the Digital Millenium Copyright Act (DMCA) was passed in that country, it briefly became illegal to unlock cell phones because that violated anti-circumvention provisions of that act, but even the DMCA has since been amended. The Harper government introduced legislation to amend the Copyright Act in June 2010, Bill C-32, that would make circumvention of many digital locks illegal. However, C-32 provides an exception for unlocking cell phones - so even under proposed legislation, it’s legal to unlock your own phone.

It is legal everywhere in North America to unlock cell phones.

Yes, if they know they need to unlock their phone to start with. Hacking instructions are available download off the internet for many phones, but customers have to know where to look and be willing to work through detailed technical directions. And this can be costly: if a mobile phone is unlocked improperly, it may stop working. If they know where to take their phone to unlock it, consumers may pay aftermarket outfits in the range of $40-150 dollars to unlock their phones. But unlocking a phone is trivial for a mobile phone company, often requiring only a few keystrokes or giving the customer a simple unlock code they can type into their handset. Many companies in other countries provide the service free.

The majority of Canadians don't live in downtown Toronto where there are grey market outfits that sell unlocked phones. Consumers can purchase unlocked phones off the web, if they know where to look, and know what to purchase (frequencies, etc). However, most people are not all that keen on spending hundreds on an unocked phone from a web supplier they've never dealt with, without holding the phone in their hands first.

Unlocking a mobile phone is a trivial matter for a service provider, and can usually be done remotely over the network. In other countries that have mandated mobile phones must be unlocked upon request, it hasn't increased costs to consumers. If a mobile phone company wishes to offer to unlock subscriber phones before the end of a contract, they are free to charge a fee for this service.

It's easy for phone companies. Many foreign cell phone companies simply require customers email their IMEI number, which is usually displayed if you enter *#06# into your phone, to the company. The company will then process email back an unlock code and instructions for that phone. Input the unlock code and the phone is unlocked. This method is usually the most efficient, as it is the same method most retail stores will offer. However, some newer phones with special network lock schemes can only be unlocked via code provided by the network or by professional unlocking equipment physically connected to the handset. There is sometimes a risk of phone damage with improper use of this equipment.

Most mobile phones sold in Canada are locked, and no major service provider will unlock your phone for you. Therefore, most used phones for sale are locked to a particular network, limiting their usefulness for someone that may want to use a different carrier. With an unlocked phone, a new owner can usually just drop a new SIM card in to the phone, regardless of the previous network it was used on.

Although unlocked phones offer greater freedom of choice and promote competition, there are minor considerations to be aware of. If you buy a phone abroad and bring it home to use, there may be compatibility issues. In rare cases, some features like web browsing might require new configuration when you switch your unlocked cell to a new provider, though if cell phone unlocking becomes common the new provider will be motivated to get your phone fully operational with their network. Also see the question "Can't consumers unlock their phones themselves?" (above) for more.

What do all these acronyms like SIM and GSM mean?
Do new entrants into the Canadian market intend to lock their phones?

SIM stands for "Subscriber Identity Module," a small card in phones used with carriers that operate "Global System for Mobile Communication" (GSM) networks such as Rogers. The competing network technology is "Code Division Multiple Access" (CDMA), used by Telus and Bell in Canada. Bell and Telus are now upgrading their network to use "High Speed Packet Access" (HSPA) technology, meaning that they are now selling phones using SIM cards too. Many other mobile phone companies in Canada such as Fido, Koodo or Solo are owned by the largest three companies and already operate on the aforementioned networks. In fact, the largest 3 companies control close to 95% of the Canadian wireless market. But some new companies are arriving. Most new entrants like DAVE, Videotron, and WIND (Globalive) will also offer phones that use SIM cards.

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