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This is a copyright issue. The Library of Congress said:
"The Register concluded after a review of the statutory factors that an exemption to the prohibition on circumvention of mobile phone computer programs to permit users to unlock “legacy” phones is both warranted and unlikely to harm the market for such programs. At the same time, in light of carriers’ current unlocking policies and the ready availability of new unlocked phones in the marketplace, the record did not support an exemption for newly purchased phones. Looking to precedents in copyright law, the Register recommended that the class designated by the Librarian include a 90-day transitional period to allow unlocking by those who may acquire phones shortly after the new exemption goes into effect."
Most phones are designed for use with a certain company, Verizon, T-Mobile, etc. That's the issue. You can buy unlocked phones but they cost more because the cost of the locked ones is subsidized by the carrier (Verizon, et al).
So, what we have here ... if one is to buy-into conspiracy theories ... is a GOP-appointed Librarian of Congress (who is awfully friendly with the Rusians) is threatening to circumvent our freedoms. And not just any old GOPer ... the appointee of Ronald Reagan. OMG! Can't trust those 'big government' Republicans!
The article overstates the case. What the DMCA bans is a person unlocking a cell phone without the carrier's consent. Once you've finished your contract term, you can still take it to the carrier and get the phone unlocked. Carriers lock the cell phone because they are selling it to you at a subsidized cost, locking it ensures they recoup the subsidy.
Locking a cell phone is similar a lien a bank puts on your home until your mortgage is paid in full.
Of course, smart consumers pay full price for a phone upfront and then sign up for a cheaper non-contract service. While you pay more upfront, you will be money ahead compared to a contract plan usually within a year.
You can, of course, buy phones that are unlocked from the beginning. For example, Verizon’s version of the iPhone 5 comes with an unlocked SIM slot right out of the box. Google sells its Nexus 4 smartphone unlocked. Typically, though, unlocked phones cost a lot more than locked ones, usually because the latter are subsidized through carrier contracts.
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