Sometime last month something changed where third-party unlockers are no longer able to easily provide unlocks for AT&T iPhones, preventing online retailers from bulk unlocking iPhone devices for resale, and it's hurting the business. Unlocked iPhones are ideal because a user can swap out an AT&T SIM card for a SIM from another carrier, which makes them useful while traveling or for international buyers.
As a result, companies that were once profitable with this business model are closing up shop, The Wall Street Journal said. "The market is gone," one retailer that is going out of business told the news outlet. Previously, the retailer, Side Street Technology, was expecting to make $1 million selling iPhone unlocks this year.
Retailers used to find it easy and cheap to unlock phones and sell the unlocks. We spoke with Ryan Negri from Negri Electronics for more insight into the issue. Negri said the problem extends far beyond iPhones. "AT&T is basically making it impossible for anyone to unlock a device that doesn't have that device linked to their account and have their account in good standing," Negri explained. "It's harder than ever. Costs have gone from $0.50, to over $125 each. AT&T has basically shut down this service, but again, not just for iPhones. Everything. We need to go through the manufacturer to obtain unlock codes now."
But why would a carrier block these services? "Part of me feels this is a response to the unlocking law possibly being rescinded, and the attempt to control their devices, or restrict their devices from being sold to be used on other networks," Negri told us. "Carriers lobbied hard for that unlocked law, all but T-Mobile I imagine."
As Negri explained, AT&T customers who have fulfilled their contract agreements can still have their devices unlocked, but it's now a lot harder for them to simply head to a website to buy an unlocked device or pay for a code to unlock their device without visiting AT&T, or another carrier, in person.