By Jim Karpen updated on 11/13/2011
Yesterday Apple began selling an unlocked version of the iPhone 4S. That means that you can use it with any carrier, and you don't need to sign a contract. But it will cost you: prices start at $649 for the 16GB phone. You can also buy an unlocked iPhone 4 for $549 and a 3GS for $375. However, the unlocked phones will only work with GSM carriers, such as AT&T and T-Mobile in the U.S.
Unlocked phones are a big advantage for frequent travelers. GSM is the most common standard abroad, and the whole cell phone business model is typically much different in other countries. No contracts, no subsidized phones. You simply buy a SIM card and put it in your phone. You can even buy SIM cards at kiosksi in airports and on the street.
So as a traveler, if you take your AT&T iPhone abroad, you're faced with large expenses. Data plans, for example, cost from $25-200 on top of your monthly cell phone bill for 20 to 800 MB of data. But if you take an unlocked phone, you're not paying your usual monthly fee plus the high fees associated with using your phone internationally. Instead, you're getting service directly from a local provider, at reasonable rates.
You can read more on CNET.