Currently in Canada, you go to a cellphone carrier, sign up for a 2 year contract and receive a heavily subsidized phone. The company can give customers phones for low prices or even free because you are locked in to paying them for 2 years, so they will recoup some of the cost of the phone each month.
In the U.S. their 3 largest carriers, T-Mobile, Verizon, and AT&T have turned the industry upside down by offering contract-free plans. Customers now pay full price for their phones or bring their own phone and pay drastically lower monthly rates and they can leave the plan anytime.
This new trend is also sparking an increase in the sale of unlocked phones. Consumers are buying more used phones, ordering them online, or going to retailers such as the apple store to buy their phones unlocked. This allows consumers to easily leave their provider if a better deal comes along and simply insert the new provider’s SIM card into their unlocked phones.
With this major change occurring in the massive market right next door, it is inevitable for Canadian companies to adopt this new model in the near future. If you’re contract is ending soon, you may want to investigate your options before signing another 2 year contract because if this market trend spills into Canada while you are in the middle of your contract, you are stuck and will not be able to take advantage of the lower monthly rates.
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