If you love new iPhones but abhor contracts, you’re in luck. As of Friday, Apple has begun to offer a carrier-unlocked version of the iPhone 5.
Unsurprisingly, these factory-unlocked iPhones cost more than their contract-requiring brethren; when you purchase an iPhone for AT&T, Sprint, or Verizon, a substantial portion of the phone’s cost is subsidized by the carrier, which they reclaim by locking you into a monthly contract. So while the upfront price for a contract-subsidized iPhone is either $199, $299, or $399 (for 16GB, 32GB, or 64GB respectively), an unlocked iPhone 5 will set you back $649, $749, or $849 for those same capacities.
The extra $450 means that you can use your iPhone without any contract requirements—so long as you are willing to use a GSM network. In the U.S., such networks include AT&T, T-Mobile, and a variety of smaller providers like Straight Talk.
The Verizon iPhone 5, in fact, is already theoretically unlocked, in that it can freely be used with GSM networks as well. But you can’t pick up a Verizon iPhone 5 without a two-year contract, so that “solution” would end up over time costing you far more than an official unlocked phone direct from Apple.
Author: Lex Friedman, Senior Contributor
Lex is a former writer for Macworld. He lives in New Jersey with his wife and three kids.