Instant money. Meanwhile the telecom company has to sell the debt at a massive discount to a collections agency or spend a ton of money collecting on it. That's assuming it can be collected on at all from someone that might just be running a scam.
With a locked phone, the phone just stops working and loses most of its value.
A rule forcing carriers to unlock phones after the term is up is fine. Forcing them to do it before is illogical. How many people are going to pay for two plans on one phone because they didn't like the first plan? I doubt it's more than those who will immediately abuse this rule and stop paying for the phone. I don't see the benefit to society here.
All this amounts to is an additional layer of securing a loan. And pre-emptively so. "You cannot unlock this device because others may abuse this."
Assess identity and credit risk better.
I have little sympathy for the carriers, after having to fight Verizon over the claim that I, living in Seattle, and being an AT&T customer for a decade with 4-6 lines and devices, somehow decided to go to El Paso and buy a phone at a Walmart on Verizon, run it up making international calls and let it go to collections.
After supplying their (onerous, tbh) info around identity, police report, current utility billing and such, VZW said "We are still satisfied that the debt is valid and belongs to you, after reviewing your documentation with documentation that was supplied when the account was opened". When I said "well, given that you have verified my identity, and given that you state that the documentation you have from the account says that it was I who opened the account, I'd like to see that documentation". Verizon: "We cannot provide that data to you as it may violate customer privacy". Schrodingers account holder. It's me when they want to collect money, it's not me when they're concerned about sharing "someone's" info or billing records...
This is just like any thing you get a loan for. It goes to collections and your credit gets hurt. Why would normal consumers have restrictions because of bad actors?
AT&T operating income for 2023 was $23.5B and T-Mobile was $8.3B. Carriers are doing just fine.
Otherwise, folks in this position should just buy the phone outright and unlocked so they don’t have any issues like you’re describing.
A carrier just eats the loss on a phone they provide but don't get paid for. The kinds of people who skip paying their cell phone bill generally have bad credit to begin with and couldn't care less if it goes to collections. The recovery rate for collections is pennies on the dollar.
And you know who will suffer if more people are able to basically keep phones for free? Not the carriers. They'll just jack up prices for everyone to offset the additional losses. You think they're just going to eat the cost themselves?
I worked in customer support for Rogers(A Canadian phone carrier) for a very short period before it was mandated to have unlocked phones and people still stopped paying their bill even if the phone was locked. The vast majority of people want to pay their bills on time especially for something as critical as phone service. The people who don't, are going to not pay their bill no matter what sort of rules in place because they either simply don't have the money or they don't care.