Unlocked Android Phone: Pricey Outside the U.S.

Just in time for the end-of-year shopping season, Google is offering an unlocked Android phone, targeted at developers but available to anyone. While the phone might be attractive to consumers and developers alike in the U.S., its price in other countries is putting off even developers.

The Android Dev Phone 1 can be used on any compatible network, unlike the G1, the first Android phone on the market that works only on T-Mobile's networks in the U.S. and the U.K. Developers can load their own applications onto the phone for testing. Previously, developers had to buy the G1 and subscribe to T-Mobile's plans if they wanted to test out their applications on a phone before adding their software to the public Android Market.

The Android Dev Phone 1 costs US$399. It is only available to registered Android developers; anyone can register as a developer for a $25 fee.

But the price of the phone is significantly higher in most countries outside of the U.S. because it appears that the phones will all be shipped from the U.S. Developers on an Android forum are complaining about large customs fees that they are being charged when purchasing the phone. One Canadian developer, who says he lives 5 kilometers from the U.S. border, said customs fees would add $264 to the cost of the phone; to ship to France costs an additional $183, according to another developer.

A Google worker on the Android team acknowledged the high customs fees, noting that they vary by country and are based on applicable laws. "While it is true that sometimes duties are not assessed depending on how shipments are labeled, it doesn't mean that legally they shouldn't be," Justin, the Android team member, wrote on the forum.

Google is selling the phone in 18 markets, including Japan, India, Taiwan, Spain, Australia, Singapore, Poland and Hungary.

While Google says that the device is not intended for nondeveloper end-users, it could appeal to some consumers, particularly those who don't want to use T-Mobile's network or who live in an area where the G1 won't be sold. In the U.S., the Dev Phone 1 will also work on AT&T's network.

The fact that Google can sell an unlocked version of the phone sheds some light on its relationship with T-Mobile. "The move by Google highlights the huge measure of influence it has over decisions regarding Android cellphones -- in contrast to the usual U.S. model, where decisions are driven mainly by the large operators, T-Mobile seems to have had little input into this one," said Caroline Gabriel, an analyst with Rethink Research, in a research note. By comparison, the exclusivity agreement between Apple and AT&T for the iPhone is thought to be much tighter, such that it would prevent Apple from selling an iPhone that could be used on another network in the U.S.