Who'd Buy an Unlocked iPhone?!

Posted by: Olga Kharif on July 25, 2007

Perusing eBay recently, I stumbled onto several ads for unlocked 8 Gigabyte iPhones going for $800. What I can’t understand is why anyone would pay a 30% premium on list price to buy one of these gadgets, offering limited functionality when not hooked up to AT&T’s service.

Unlocked, these devices can only access the Web and download music off of iTunes via Wi-Fi hotspots. Unless they are locked up again (to do that, users must take the devices to an AT&T store and sign up for service), they don’t work over cellular networks. Is Wi-Fi functionality alone worth $800? I don’t think so.

A $125 device from Netgear or Linksys would do nearly as well. While these gadgets don’t provide access to iTunes, or brag the cool iPhone interface, they do allow users to surf the Web, message friends and place calls via Wi-Fi networks. And, unlike unlocked iPhones, these devices do have a warranty.

It’s my understanding that Apple, like most electronics manufacturers, voids warranties on tampered-with devices. So my main concern in buying an unlocked iPhone off of eBay would be that the device won’t work at all — and that I will be stuck with a pretty paper weight and an $800 hole in my bank account.

Reader Comments

iphoneuser

July 26, 2007 11:56 AM

Not sure you understand what "unlocked" means: http://en.wikipedia.org/wiki/SIM_lock. An unlocked iPhone would be able to accept a SIM card from other carriers (e.g. as a Sprint user, I could make phone calls from my iPhone). Unlocking or locking has nothing to do with wifi use.

wayne

July 27, 2007 12:27 PM

Sprint is a bad example as they use CDMA technology which does not have SIM cards for their phones... A better example is a TMobile user who wants to get an unlocked iPhone to use it with his TMo SIM.

J

July 27, 2007 2:47 PM

The only problem with buyimg an unlocked iphone is that there is no sim card used. You activate the phone through itunes, AT&T then will transfer your account info to the phone within a few hours. So I really don't see how one could unlock a phone that doesn't use a sim card in the first place.

P

August 1, 2007 3:36 AM

olga: why are you writing for business week? You do not understand technology or its applications, that much is obvious.

You fail to understand the value of the iphone and that its emotional connection lie in its ability to do what it does better than other phones...cell manf do not get it and apple has moved the ball...

So it will take some time for people like you to GET IT..by that time apple would have moved the ball even further.

Who wants an unlock phone..about 3/4ths of the world that is used to buying phones and cellular service separately (all GSM users) and the US users that do not care about ATT but want to replace the 5 devices that they are carrying by a single one or people like me who want web access on the move with an experience similar to a notebook.

GET IT? Now please go and return your salary to business week and apologize to them for not adding value.

Marko

August 15, 2007 3:54 PM

I would gladly pay $800 for an unlocked iPhone. I am a TMobile user that travels overseas a lot and an unlocked iPhone would be fantastic for me. I absolutely hate AT&T and will never go back to them regardless of the cell phones they offer. An iPhone that I can take world-wide and slip in any GSM sim card is on the top of my list of gadgets to get. It would replace my laptop, ipod and cell phone into one convenient apparatus.

Jayz

August 23, 2007 8:46 AM

Olga: I agree with the post by "P": Posted by: P at August 1, 2007 03:36 AM

If you have no idea why people would pay for it then, please go back to school and learn about business and the smart tactics that Apple has used to market this product.

protagora

September 4, 2007 3:54 AM

who wants to buy it?well,maybe someone who lives outside us, where it isn't available,and needs to be unlocked so it can be used on other networks/providers

Jared

November 28, 2007 2:06 PM

ALot of people want unlocked iphones. In America, most people dont use atnt so iphone isnt an option for them. Unlocked iphones enables them to use it with any network. I bought one from Http://www.ebaysweep.com its a new branch off ebay.

Nick

December 6, 2007 4:22 PM

Recently bought an iphone from http://www.gameconsolesshop.com which lists all the good ebay auctions so I managed to get an unlocked one for quite a cheap price.

Shell

January 5, 2008 4:52 PM

I want one, but not for $800 - I'm goin to wait until they go down in price, I think it's unfair Apple only went with one UK tariff - O2 - their contract is ridiculous - 35 pound for only 200 texts and minutes!! I prefer pay as you go and cannot believe Apple never thought of bringing one out also on Pay as you go. Plus how many times do you change your phone because the network goes expensive, if that happens with an unlocked iPhone you won't have to change your phone. All you'll need is another sim.

Gianni

April 5, 2008 11:53 PM

I almost always buy unlocked phones so I can hop carriers the instant they lie, mislead or otherwise piss me off. Having the freedom of the middle finger option ends up being cheaper than a low cost phone and being locked in.

Does anyone know exactly what functionality is lost by not being on AT&T? I am on TMob. Also you may be able to put a pay as you go SIM in the phone as well...

Chelsea

June 19, 2008 12:17 AM

...so, I'm an American who travels to the uk on a regular basis, and would love to have something as multi-tasking as an iphone, and I dream of a phone I can take anywhere, and be able to switch from my O2 min.s to my U.S. cell phone company.Now,a question for someone more informed, would an unlocked iphone reject my O2 pay as you go sim card or is this the answer to my mobile dreames? (ohpleaseohpleaseohplease)

Deb

September 2, 2008 6:15 PM

I’m right there with you, Marko. AT&T is a horrible provider in many ways. But I refuse to pay $800 for a phone no matter how many cool things it can do. I’ll just sit back, wait until the iPhone situation changes and continue to enjoy my Mac.

Danny

September 19, 2008 11:11 AM

This to Olga how did you ever get a job writing for business week, when clearly you don't know what in the hell your talking about. Have you ever heard of a simcard? Guess not!

Asia

October 21, 2008 3:53 AM

People in Asia where new phones can easily cost upwards of $1,000 would drop $800 on this.

An unlocked iPhone in Thailand used to cost close to $2000

Prozinecki

February 26, 2009 10:40 AM

Gloria really, go and write about handbags and shoes, cuz definetely tech is not strong in you
And I mean that

Paxalot

March 2, 2009 4:53 PM

In Canada the iPhone contracts are outrageous. If you buy an iPhone unlocked you can put in an inexpensive pay-as-you-go SIM and save yourself thousands of dollars a year. You would do this if you used the iphone apps as well as the phone itself.

Tins

March 26, 2009 12:21 PM

Well I would say this.. Bringing this article on web is still not bad.. Atleast those who have no clue what unlocking is would know now.. And trust me there are millions who wants to know what unlocking really is and why pay so much extra just to get one!

Thanx to ya all...

Lucas

May 13, 2009 11:42 AM

I don't believe I'm reading it from BusinessWeek. Either you have no clue of what you're talking about or you work for AT&T part-time.

Simon

July 29, 2009 4:55 AM

Olga - there is obviously a market for unlocked phones hence the many listings on ebay. Doesn't this tell you something before you make yourself and your employer look silly with this kind of article?

Korea

August 11, 2009 8:14 AM

If anyone is traveling to Hong Kong, you can buy unlocked iphones all day long.

Dans

August 19, 2009 11:50 PM

What a tool.

Buying unlocked means you can use any carrier to provide service, you dont need to be locked into a long term contract and you pay about half the price for equal minutes/text/data per month.

You obviously know nothing about mobiles or are doing a 'Dvorak' and need to read up more before posting such dribble.

Melissa

August 25, 2009 3:11 PM

This article is obviously a 'play' on the ignorance of people(mostly americans) and apparently a psychological marketing piece ultimately initiated from AT&T--for those of you who honestly believe BusinessWeek has employed a complete idiot(olga- if thats even her real name). I am happy to see it has 'backfired'.

B

September 29, 2009 3:35 PM

I believe, she does know want she is doing. AT&T must have paid her a lot of money, otherwise why else would she embarrass herself like that?

chelsea

October 6, 2009 9:18 AM

ok i have a question in general. i currently have at&t and am looking at buying an iphone. I would like to buy one online instead of in store. My question is, Can i buy an iphone online and activate it once it gets to me? And is there a certain kind i need? my current pantech has a sim card so do i just switch them out? i no nothing when it comes to phones.. just that im not spending $500 in store for an iphone!

Ruth

October 15, 2009 3:00 PM

Olga, people outside the US can't get the offers you guys have there.. Iphones and Blackberries are veeeery expensive.

Source: I'm Venezuelan

Outis

November 7, 2009 10:19 AM

I stumbled upon this article when I'm specifically looking for info on buying unlocked iPhones. I must agree with Melissa above: I think this is a rather cynical attempt, maybe some kind of anti-viral campaign, on the AT&T's part to discourage potential unlocked iPhone buyers.

Olga here may know nothing about the technological details involved here, but if she as a "senior writer" (according to her profile page) for BusinessWeek, she presumably must know at least the basics of how business work. She sees a lively market for unlocked iPhones on eBay but tries to rationalise it by saying that all the buyers are idiots. Either she really lacks the basic competences of a business writer, or she has sold her journalist neutrality to AT&T. Maybe she owes BusinessWeek her salary, but then maybe BusinessWeek simply doesn't look for intelligence or integrity in their writers.

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Bloomberg Businessweek writers Peter Burrows, Cliff Edwards, Olga Kharif, Aaron Ricadela, and Douglas MacMillan, dig behind the headlines to analyze what’s really happening throughout the world of technology. Tech Beat covers everything from tech bellwethers like Apple, Google, and Intel and emerging new leaders such as Facebook to new technologies, trends, and controversies.

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