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Where I live you can walk into a shop, buy a smart phone, then pop in a sim card and be off. Can you not do this in the US?

You don't pay any monthly service and I don't see how the carrier you have chosen to buy a sim card from has any basis for claiming that the phone I'm using is somehow not owned by me.

Since I purchased my first mobile phone around ~11 years ago this is how I have always done it.

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You can do that in the US, but it isn't common because of carrier subsidies. Even worse, sometimes when you pay full price for a phone you still wind up with something that is carrier-locked anyway. Plus there are all sorts of technical incompatibilities (e.g. AT&T vs T-Mobile 3G bands) even if your phone is otherwise unlocked. And so on...

Surely when you get a contract for your phone & service you pay X for Y months and this should cover the cost of the phone anyway. So even if you switch the phone to a different carrier you're going to be paying the contract amount anyway.

I could unlock my phone and use a different carrier (considered doing this after the o2 fiasco yesterday) but it wouldn't make economic sense to me.

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