Telcos ordered to 'unlock' phones for free after subscriber's contract ends

MANILA - Telco subscribers who bought locked-in phones will soon have the option to have these devices unlocked, free of charge, to use in another network.

The National Telecommunications Commission (NTC) on Wednesday released an order for all telcos who sell discounted devices in exchange for a fixed lock-in period, to assist in unlocking those devices after the subscribers' service contract ends.

NTC releases guidelines requiring all Public Telecommunications Entities which offer mobile phones and devices to subscribers, to assist said subscribers in unlocking the same devices. They have 2 days to do so upon request of the subscriber. @ANCALERTS @ABSCBNNews pic.twitter.com/D6fy8iwOEA

— Warren de Guzman (@wddeguzman) June 5, 2019

The lock-in-period is meant to prevent subscribers from leaving one telco for a competitor, by making their devices unusable with other mobile networks.

In a memorandum dated May 31, the NTC said that after the service contract is fulfilled, the subscribers who bought the phones are considered "absolute owners" of these devices and "should have the option of changing between compatible wireless service providers."

Postpaid subscribers who bought a phone from one service provider but wish to transfer to another network before the end of their contract can also have the phone unlocked on payment of an applicable early termination fee, the NTC said.

Prepaid subscribers can ask for the unlocking of their devices for free.

Telcos must unlock devices within 2 business days of a customer's request. Service providers are also required to notify customers when their device is eligible for unlocking or automatically unlock them remotely without any additional fee.

Previously, subscribers who wanted to unlock their devices were forced to use unsafe methods online or go to service shops not recognized by telcos or mobile phone manufacturers. Aside from the possibility of damaging the device, this practice could also result in the voiding of warranties.

Only subscribers in good financial standing, which have fulfilled the terms and conditions agreed upon when they availed of the free or subsidized device, are eligible for assisted unlocking of their device.

Telcos are also required to enlist the help of the device manufacturer in any unlocking procedure if needed.

The NTC order follows the signing of a law last February, which enables consumers to keep their mobile numbers in case they switch service providers or change their subscription plans.

The move is seen as easing the entry of the Mislatel, which was chosen as the third major telco player.