No Contract, No Subsidy

Two bits of news from the last couple of days point to a new trend: unsubsidized phones being offered without contracts. While these phones cost a pretty penny upfront, not being forced into a contract — and having the freedom to switch from carrier to carrier — is sounding mighty attractive these days.

Some news on the open wireless Internet:

  • Rumors abound that Google may be releasing its own phone. No, not just another HTC or Motorola phone with Android pre-installed, but a Google-branded phone. Just like Apple's iPhone, this Google device would be all Google, all the time, with Google in total control of the user experience and hardware. You know, a Google phone.

    Some, like the Yankee Group's Carl Howe — who wonders if this might be a "net neutral" phone — see this as an opportunity for Google to break the shackles of the carriers. Howe predicts a couple of whoppers: 1) Google's will come without a contract, would be unlocked, and would work on any network, CDMA or GSM; and 2) The phone wouldn't be subsidized, so while its upfront cost would be a bit more than an iPhone's, you wouldn't have to pay off the carrier's supposed subsidy.

    Meanwhile, TechCrunch suggests that the phone would be data only, and would make calls via VoIP (presumably using Google Voice) over a data network. I'm not sure how the carriers, who are already griping at increased data usage, are going to feel about that.

    At the moment, Google is keeping mum. We can dream.

  • Speaking of no-contract phones, T-Mobile has announced it's offering the BlackBerry Curve for $300, with no contract. While that's a hefty price tag, not having a contract —and thus no early-termination fee — is sounding mighty attractive to folks annoyed at Verizon's $350 ETF.