SCAM ALERT: Verizon Locking SIM Cards on Smartphones

A warning to buyers of the new Pixel 3 smartphone or any other new phone purchased from Verizon:  the company is only selling locked phones.   Said another way:  if you buy a new smartphone from Verizon, expect the SIM card to be locked.   This is a big deal.  Why?  Because Verizon is illegal prohibited from locking the SIM cards to phones that it sells.  Moreover, it makes the phone a lot less valuable or useful.

Verizon should not be locking its phones because, among other things, it legally promised not to do so.  Here’s the language from a document signed by Verizon in 2008:

§ 27.16 Network access requirements for Block C in the 746-757 and 776-787 MHz bands.

(a)Applicability. This section shall apply only to the authorizations for Block C in the 746-757 and 776-787 MHz bands assigned and only if the results of the first auction in which licenses for such authorizations are offered satisfied the applicable reserve price.

(b)Use of devices and applications. Licensees offering service on spectrum subject to this section shall not deny, limit, or restrict the ability of their customers to use the devices and applications of their choice on the licensee’s C Block network, except:

(1) Insofar as such use would not be compliant with published technical standards reasonably necessary for the management or protection of the licensee’s network, or

(2) As required to comply with statute or applicable government regulation.

(e)Handset locking prohibited. No licensee may disable features on handsets it provides to customers, to the extent such features are compliant with the licensee’s standards pursuant to paragraph (b)of this section, nor configure handsets it provides to prohibit use of such handsets on other providers’ networks.

This document isn’t just any old deal.  It is deal with the Federal Communications Commission requiring it to unlock phones as part of its acquisition of the “C block” of 700 megahertz spectrum, which powers its 4G LTE network.  Verizon agreed to it as a condition for its being able to use this spectrum.    And yet, it’s locking of the Pixel 3 flies directly in the face of this legal requirement.

So what gives?   Verizon claims the only reason it is locking the SIM card is to combat theft.   Hmmmm.   Funny, given that the rate of smartphone thefts appears to have dropped since anti-theft measures went into effect in 2015.   And when cell phone manufacturers were required to install kill switches in their phones,  reported cell phone robberies and thefts from persons dropped in half.    In the most recent two years, they fell again by another 8 percent, to a total of 1,754 last year.

So Why is Verizon Doing This?

The truth is currently pretty elusive.  Verizon claims on its website that it only locks phone purchased through its “phone in a box” promotion  (which we think is also illegal).

And yet, in the media, Verizon has acknowledged that it is locking its customers’ phones for a prescribed period after purchase.   So Verizon appears to be truth-challenged on this new, controversial policy.

Why Locked SIM Cards Are Wrong

There’s a reason that regulators have insisted that carrier sell unlocked phones — it’s anticompetitive.  Buying an unlocked phone means you can easily switch wireless operators. \In the past, carriers would lock SIM cards to prevent you from switching.   That practice was all but eliminated due to actions by Federal and state regulators.  Now, if you want to switch carriers, all you have to do is insert in a new SIM.

An unlocked SIM card also comes in handy for people traveling overseas. It’s usually less expensive to use a local wireless service while traveling abroad. When travelling, you can just  pop out the SIM card in your phone and replace it with one from a local carrier in that country.   This gives you a  new local number which makes it cheaper to make calls in country and/or access the internet.  Verizon’s “security” tactic screws this up, big time.

What To Do If You Get A Locked Phone

Two words:  Return it.   Verizon has said that it won’t lock its phones.   Hold the company’s feet to the fire.  If the retailer from whom you buy the phone refuses to unlock it, then just return it.

However, our stronger suggestion is to refuse to buy a new smartphone from Verizon until the company stops lying about this practice.  It needs to either come clean with a compelling reason for violating its promise OR it needs to return to its decade-long practice of not locking its phones.    The Pixel 3 can be purchased at Best Buy or directly from Google Store.   There’s no need to subject your phone to wrongful restrictions imposed by Verizon.

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