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Apple(s aapl) started selling unlocked versions of the iPhone 5 in its online store last night, allowing the contract-averse to pay full price for their device and then take it wherever they damn well choose. Assuming you’re willing to shell out the $649 to $849 necessary to buy the unsubsidized device, what exactly are your carrier options?
Apple produced three versions of the iPhone 5 for different carriers and global regions, but the only unlocked version it appears to be selling is the GSM-LTE device for AT&T(s t) and the Canadian operators’ networks. That means you won’t be able to bring your pricey new gadget to a CDMA carrier like Verizon(s vz)(s vod), Sprint(s s), Cricket(s leap), MetroPCS(s pcs) or US Cellular(s usm). But the device will work on the networks of almost any GSM operator globally, whether AT&T, T-Mobile or Cincinnati Bell, Vodafone, Softbank or Telefonica(s tef). You just need to plug in the carrier’s SIM card.
There’s one big caveat though: While GSM (i.e. voice and 2G data) will work fine on the iPhone 5, more advance, faster data capabilities are a toss up, especially here in the US. If you’re hoping to get LTE access here in the States, then I’m afraid you’re out of luck. For now there’s a single US operator that has an large LTE network supporting this version of the iPhone, and that operator is AT&T. But that situation is changing as I’ll discuss more below. And there are definitely some decent carrier options for 3G out there.
If you haven’t read my colleague Kevin Tofel’s definitive post on the virtues and vices of Tracfone’s SIM-card smartphone service Straight Talk(s amx), well, then you should. Straight Talk is a mobile virtual network operator (MVNO) that uses AT&T and T-Mobiles’ networks, but far undercuts both carriers in price. For $45 a month you get unlimited voice, SMS and roughly 100 MB a day of data.
For the iPhone 5, you’ll want to get a Straight Talk AT&T SIM, since you’ll have access to far greater 3G HSPA coverage. And while the iPhone 5 could technically access AT&T’s LTE network, Ma Bell hasn’t started offering up 4G access to its MVNOs yet so you’ll get HSPA speeds.
There are several other AT&T MVNOs that offer similar bring-your-own-iPhone plans: H2O Wireless and Red Pocket are two. Another MVNO you might want to look at in the future is FreedomPop. It is developing a WiMAX sleeve for the iPhone 5, and will eventually offer a VoIP service. Once those pieces are in place, it will basically turn the iPhone 5 into a data-only softphone.
T-Mobile has been preparing for the unlocked iPhone 5 since it was announced – it may not sell the device, but it’s welcoming unlocked iPhone owners onto its network with open arms. The problem is T-Mo’s current funky network configuration means that it can only offer 2G data speeds on the device in most parts of the country. T-Mobile is in the process of reconfiguring its network, though, and has iPhone-friendly HSPA+ networks in 15 cities already.
In the next six months, its entire 3G network will be iPhone ready. So if you can wait a few months for mobile broadband — or live in one of the areas that already support faster HSPA+ speeds on the 1900 MHz frequency — signing up for one of T-Mobile’s value plans could give you a boatload of data for much cheaper prices than AT&T and Verizon are offering. Plus, since the iPhone 5 supports dual-carrier HSPA+, T-Mobile’s 3G network will be able to deliver near LTE speeds.
There’s another advantage to going with T-Mo. It’s LTE network will go live in the second half of 2013 over 1700 MHz/2100 MHz Advanced Wireless Service (AWS) band, which the unlocked iPhone just happens to support. The iPhone’s data capabilities may be limited on T-Mobile today, but it will be fully compatible next year.
This may seem like a strange option, since most people buying an unlocked iPhone are trying to get away from the big carriers and their contracts, but the fact remains that AT&T is the only operator that can support the GSM iPhone 5’s full complement of 3G and 4G data connections. The advantage of using AT&T off contract is that when better options emerge, you’re not tied down to a two-year commitment. You can start off with AT&T, and when Straight Talk or T-Mobile gets LTE you can make the switch.
One final word of warning. To support the iPhone 5, your carrier will need a nano-SIM card, which is smaller than the standard micro-SIM most carriers use. Check to make sure your chosen carrier offers it before you take the plunge. Otherwise you’ll be forced to perform surgery on your SIM to get it to fit.