The main reason why UK mobile service is much cheaper than the rest of Europe (not counting cost of living differences) --- is because UK has 5 national carriers. That is enough to make the iphone the cheapest in the G7.
UK carriers DO offer unlocking codes for a fee (other than the occasional iphone or blackberry storm) --- for business reasons to their customers. They don't have to do it according to Ofcom policy, but they do offer it anyway.
Hong Kong still has the cheapest iphone in the whole world --- the reason --- they have 6 carriers. Hong Kong has an exclusive iphone carrier and does not have any simlocking regulations --- yet Hutchison 3 HK sells the iphone completely unlocked at a price that is the cheapest in the world.
The other extreme is France --- where they have all kinds of regulations on how and when unlocking codes are given by the carriers, that their courts killed the iphone exclusivity --- yet their iphone prices and plans sucked big time. Why? Because France has only 3 national carriers, all French owned, zero foreign competition inside France.
Aside from the iphone being the exception, both American national GSM carriers (AT&T and T-Mobile USA) offer unlocking codes for free after 30-90 days of using their service. They both do it voluntarily --- zero government regulation forcing them to do so.
The whole reason why Ofcom changed their policy back in 2002 is that there are many other methods to increase competition that are more effective.
Thanks for replying - but,
Hong Kong is on the doorstep to China. That's why they are unlocked - Apple decides. Rather simple. Further on it seems "cheap" to us, because you don't adjust for cost of living/purchase power parity.
As you know, the people actually making the iPhone in China, does not earn enough to buy them. That's why they are being produced in Asia. Cheap labour.
Norway's got a population of 4.8 million people and only two major GSM carriers (the rest buy air-time from the two big ones). But the law prevents carriers from making contracts that span over more than 12 months. Also, after that period carriers are obligated by law to unlock handsets.
If you adjust for median income/purchase power, Norway's way better off than most countries. Britain too. And of course, Norwegians can sell/use their phones for whatever they want after the first 12 months.
Oh, and btw, zero foreign competition.
Your only valid example is France, and though I'm sure you're right there is a lack of competition there: the high-end iPhone 3G 16GB cost £483 (unlocked, contractless), low-end 3G 8GB £404.
Compare that to the £380 iPhone 3g 8GB (when it first came out) PAYGO in UK - locked, forever.
Not too bad?
I won't specualte as to why some companies will unlock their handsets, even if not required to do so by law. But it's not interesting, with respect to the fact that locking do occur in some cases, and prevents competition.
I'm still waiting for proof as to what makes unlocking-practices bad for prices. Though I'm not holding my breath. Of course, there are other measures, though you mention _zero_. But that does not negate the fact that being able to unlock your device after the contract expires, will eventually increase competition and give lower prices.