Evan Swarztrauber: Your Phone, Their Rules. It’s Time to Unlock the Mobile Market

Affordability is top of mind for voters and consumers, as the costs of essentials like healthcare and housing remain stubbornly high. One rare bright spot is mobile internet service, where cellphone plans have bucked inflationary trends and dropped 4% last year. 

The falling prices can be traced back to smart policies adopted by the Federal Communications Commission under the first Trump administration, which repealed onerous broadband regulations, freed up spectrum to a wide range of providers, and streamlined permitting for internet infrastructure. Now-Chairman Carr has continued building on those wins, including by deleting outdated rules and issuing more permitting reforms.

These policies have unleashed fierce competition in mobile internet, but consumers can only fully reap the benefits if they aren’t locked into their cell phone plans through policies that prevent them from taking their phones to different carriers. For consumers to fully benefit from the current competitive landscape, the FCC should take action to curb these practices.

Mobile locking is underexamined and perhaps even overlooked by consumers when they sign new contracts. When a consumer buys a cellphone through a carrier’s equipment installment plan (EIP), the device is typically “locked” to that carrier’s network. The phone functions normally, but it cannot be used on a competing network—in many cases, even once the phone is owned outright. In theory, the consumer “owns” the device, but in practice, the carriers still hold the keys.

These restrictions can limit real competition. If a customer can’t move to another carrier’s more affordable plan, their carrier has no incentive to reduce prices.

This is basic economics. Competition only disciplines prices when consumers can freely move between providers. It’s the same reason why customers see cheaper plane tickets when multiple airlines compete for a route.

Competition in the wireless market is robust, as nationwide carriers compete with new entrants. The rise of direct-to-device satellite service will inject even more competition. 

But mobile locking weakens all the pressure to reduce prices and improve service—and that’s by design. Reasonable waiting periods for phone unlocking to guard against fraud are fine—no one opposes that. But unlocking should otherwise be automatic once devices are paid off, and customers shouldn’t be forced to pay fees or jump through hoops to take their phones—their own property—to a competitor that could be saving them up to $1,000 annually.

There is overwhelming, bipartisan support for easy switching. A recent poll by Fabrizio Ward and The Bull Moose Project found that 93% of voters believe that switching phone carriers should be as easy as switching phone numbers.

Notably, carriers used to force customers to change their phone numbers to move to a competitor—for the same anticompetitive reasons that they lock cell phones. The FCC recognized that this practice undermined competition and mandated wireless number portability over two decades ago. The agency and Congress should consider similar action to enable phone unlocking.

Voters favor giving consumers the right to switch providers by an 85-to-6 margin, with strong support across party lines. That kind of consensus is rare these days. It exists here because the problem is straightforward for voters: they should have the freedom to choose where they go with the phone they’ve paid for. 

Reforms to the mobile unlocking period for consumers could be an easy win to ensure consumers actually benefit from competition and falling cellular prices. The FCC has the existing authority to act by adopting uniform rules on a mandatory, reasonable unlocking period. It would nullify anticompetitive and anti-consumer practices, allowing consumers greater flexibility that could save them hundreds of dollars a year.

Consumer freedom is what drives down prices, including the right to shop for cellphone service among all competitors in the market. Americans' phones should work for them, not for the carriers that sold them.

Evan Swarztrauber is Principal and Founder at CorePoint Strategies, and technology and telecommunications policy firm. Previously, he was a policy advisor to FCC Chairman Ajit Pai and then-Commissioner Brendan Carr. This Expert Opinion is exclusive to Broadband Breakfast.

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