Last week, Apple started selling unlocked iPhones. This excited the iPhone community at large. Why? Partly because unlocked iPhones are an interesting choice and partly because there’s a cool factor to the term “unlocked.” Prior to purchasing a phone that goes without a contract, there are a few things to consider about unlocked phones. Is it really a good idea to purchase an unlocked iPhone? Here’s the scoop.

What An Unlocked Phone Is and Does

The term “unlocked” is thrown around a lot. Technically, a phone that is unlocked is a phone that is not provided by a specific carrier and does not come with a contract. Carriers will not lock users into a two-year contract if a user purchases an unlocked phone. Another term that goes along with “unlocked” is “jailbroken,” and this term refers to users who unlock contracted phones in order to use those phones with other carriers. There are some reason why an unlocked phone might be a good idea. The first reason has to do with those pesky contracts.

No Contract – Less Hassle

It’s rough being locked into a cellphone contract. Once you’ve signed those papers, you can’t switch to a different carrier. So, no matter how much your current carrier doesn’t care about your business, you are stuck with that contract. Switching to an unlocked phone will help you avoid the carrier problem. Another reason why people like unlocked phones is that unlocked phones are almost the only option when traveling to another country.

Unlocked While Traveling

You can’t really travel with your current contracted iPhone. Well, you can, but you’ll pay a lot of fees for traveling while roaming. With an unlocked phone, you can switch to GSMs in various countries, so you never have to worry about not having your phone when you need it. Of course, there are drawbacks to purchasing an unlocked phone too – starting with your budget.

Unlocked Phones are More Expensive

Have you ever wondered why iPhones are not more expensive? Carriers subsidize part of the expense when you sign a contract. Without a contract, carriers will no longer pick up the tab. So, you could pay up to $700 for an unlocked iPhone 4, and that’s just not a lot of fun. Consider the hefty price of an unlocked phone before you decide to purchase one. It’s also worth thinking about whether or not you wan to pay an early termination fee.

Breaking a Contract: Fees to Pay

Did you think your carrier would let you go without any kind of fine? Think again! Carriers will slap you with a nice and big Early Termination Fee (ETF) fine when you decide to break your contract and purchase an unlocked phone. Unless you don’t mind paying a few extra bucks for your phone (and I mean, lots of money), don’t go for the unlocked variety. So, who should purchase an unlocked phone? Those who have unlimited funds, don’t want a contract, and travel frequently. Otherwise, may the best carrier win!