Verizon Wireless announced yesterday that they will be revising their policy on allowing free-market cell phones to be used on their network. The change will take affect by the mid part of next year.

In effect, it will allow you to buy just about any cell phone, from any vendor, and activate it on the Verizon network.

This is big!

Not just because it gives you more freedom to use whatever cell phone fits your needs, but it also signals that the free market does have an effect, even in the highly competitive wireless industry.

What’s next? Perhaps more flexibility in pricing and plans, and even better, more accessible data streams and free interface to the internet. I for one would like to see a WI-FI card built into every cell phone, as Verizon currently disables that capability, even on phones that come with the feature from the manufacturer.

There are some aspects of this deal that have not yet been worked out, such as whether Verizon will differentiate in plan price based on where you bought your cell phone, and what features it will allow a non-Verizon cell phone to utilize.

As for now, though, this seems to be a step in the right direction, as Google and other tech companies make it easier and less costly to gain access to information and communication technology.

As a side note to the disintermediation in the cell phone sector, AT&T, Sprint Nextel Corp. and T-Mobile USA all responded to the threat of government regulation by announcing (several months ago) that they would follow Verizon’s move last year to prorate fees for contract termination rather than forcing all customers to pay early termination fees that run as high as $200. While I’m not a fan of locking customers in to an unregulated service for such long periods, this move is definitely a step in the right direction!

Tags: cell phones | disintermediation | Verizon Wireless

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