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AT&T, Others Fight Back Against Pre-Paid Phone Traffickers

Article Comments  58  

Feb 7, 2008, 4:35 PM   by Eric M. Zeman

AT&T has filed a lawsuit against Wireless Exclusive USA for illegally re-selling hacked AT&T pre-paid phones. Other companies, including T-Mobile and Nokia, have filed similar suits against traffickers.

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Feb 7, 2008, 6:49 PM


I buy a phone. I have the right to do whatever I want. If I want to hack and resell it, that's my right. Don't take that away from me. You're getting your outrageous phone price. If a carrier doesn't like it, tough. I don't sign any license agreement to buy a phone. It's a free country, dangit.
well yes u can buy ur phone and do whatever you want with it but when u are using that phone with a network u are making a legal agreement with that company to use their property which is their spectrum and network. within the law they can make any r...
And the last time I checked that freedom was extended to businesses as well. You want it both ways: Limit what the corporations do but don't put any limits on what I can do. Life does not work that way. That is why we are a society of laws. We protect...

Feb 9, 2008, 12:20 PM

The famous line...

What they failed to mention is how many of their reps (COR stores and customer service) tell customers to go to WalMart to get a go phone and put their SIM card into it.

I wonder how many phones were "lost" due to this happening...
colione112 said:
What they failed to mention is how many of their reps (COR stores and customer service) tell customers to go to WalMart to get a go phone and put their SIM card into it.

I wonder how many phones were "lost" due

Feb 9, 2008, 2:44 PM

I am a shopper and here is the real story.

I go out and buy prepaid phones and resell them. What these companies like tracfone and At&t do is sell these phones below cost and try to make their money on the overpriced service.

For instance... Tracfone owns two companies; themselves and Net-10. A couple of months ago the price of Net-10 phones and Tracfones were very different. Net-10's phone X cost about $50 but the same phone from Trac was $20.
The tracfone company pays about $25-30 for phone X from the producing company. Now why is that? The reason was that Tracfone was charging about 30 cents per minute and Net-10 was only charging 10 cents for the same minute. Tracfone buys wholesale minutes from companies like T-Mobile and Cingular for about 2 cents. At the end of the da...

Feb 7, 2008, 7:03 PM

The risk of dumping

The carriers want the freedom to dump their products (selling below wholesale), but don't want to accept the risk associated with their own decisions. They need to stick with one argument--do they want a free market or do they want to obey government regulations?

If you ever tried to buy a new phone without extending your contract, this affects you. A carrier dumping its prepaid phones on the market to lure in customers has a negative effect on the availability of unlocked phones. We can't find many reasonable deals on unlocked phones because honest sellers can't compete with T-Mobile's $30 Nokia.
Its funny too .. because the practice of dumping below cost product on the market is technically illegal.

Feb 7, 2008, 8:41 PM

New Customer additions?

so when these are just bought and then resold somewhere else does that still count for a new customer to AT&T, when it comes to their Quarterly Numbers, Churn %, and total subscriber counts??
No, because these phones are making it outside the US, only to be unlocked and activated with other -foreign- SIM cards. I highly doubt that whoever is buying these phones in bulks is actually activating them. To be honest, I'm surprised at how long ...

Feb 7, 2008, 5:56 PM

How is this unlawful?

The LoC has stated specifically that unlocking a handset is not a violation of the DMCA back in late 2006. Read: Exempt from DMCA: http://www.copyright.gov/1201/docs/1201_recom mendation.pdf

Also, the state department does not prohibit the exportation of cell phones.

Prepaid carriers are selling handsets at retail locations without requirement of activation or contract. We all know that that motorola phone is not really $14.99, and some sort of subsidy exists. But they are still just selling you a phone. I am not legally required to activate it and use it for a length of time. I could toss it into a room and let it rot for all it mattered.

So...someone gets smart, takes these phones, unlocks them, and sells them over seas an...
I don't think it is even "slimy." If the carriers were not flooding the market with sub-wholesale prepaid phones, these "traffickers" could afford to make a business of reselling phones purchased at wholesale.

Feb 8, 2008, 4:10 PM

AT&T Wants To Set Case Precedent For Unlocked iPhone Sales?

While there may be losses amounted by the unlocking and sales of cheaper 'no-frills' phones, I smell something fishy.

Could this really just be a strategy to eliminate the sales of higher-end unlocked phones by anyone but the carrier who released it (or the specific version of it)? That is, another way to counter legal unlocking and control BOTH the "razors AND the razor blades"?

What everyone knows (right?):

GSM carriers in the USA don't have the advantage of CDMA carriers, who completely control access to their networks by disallowing "foreign ESNs" aka the 'other' carrier's phone (even as much as Sprint, Verizon, etc state that they will be "open" and allow "approved" phones, they still have complete control when it comes to act...
"Could this then be a way to get back to exercising control over their "exclusive handsets" and networks, and undermine the rights the DMCA's allowance provides?"

No, they are just greedy douchebags.
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