Device Unlocking Policy page with new language saying that Verizon Prepaid phones must be used on Verizon Prepaid for up to one year before they can be used on any other service. Until this change, Verizon allowed prepaid phones to be used on MVNOs or on Verizon postpaid, provided they had been activated on Verizon Prepaid and the first month's payment made. You can see the old policy on the Internet Archive's Aug 30, 2016 copy of the page.
The exact wording of the new rule is:
"We do not lock our 4G devices, other than our 4G Phone-in-the-Box Prepaid phones. In order to partially offset the subsidy we provide to make our 4G Phone-in-the-Box Prepaid phones more affordable to service customers, our 4G Phone-in-a-Box phones may only be used with Verizon Prepaid service for 1 year from original activation date or until payments in the amount specified on the back of the Phone-in-a-Box package are added to the Prepaid account."
The cheapest Verizon Prepaid plan for smartphones is $30/month for unlimited talk and text and no data. The new rule change means that the "ransom" needed to liberate a prepaid phone for postpaid or MVNO use is increasing from $30 to as much as $360!
This change may not be as bad as it looks however. The new rule requires use on Verizon Prepaid for "...1 year from original activation date or until payments in the amount specified on the back of the Phone-in-a-Box package are added to the Prepaid account." I visited my local Target store and checked the backs of the boxes of all the Verizon Prepaid LTE phones in stock. Target had the Samsung Galaxy J1 and Galaxy J3, the HTC Desire 526 and the LG Transpyre and Optimus Zone 3. They all had the statement statement on their boxes:
"Phone must be activated on Verizon Prepaid and the first monthly payment must be made before the phone can be used with any other service."
What I don't like about the new policy is that if you are buying a Verizon Prepaid for use on a different service you now have to look at the back of the box to find out the ransom requirement. That's not always easy. Most big box stores have anti-theft devices that can make hard to see the back of the packaging. At my Target I had to struggle to maneuver the phone packages into a position where it was barely possible to read the back of the package by contorting my next into an uncomfortable position. For online shoppers it's impossible to see the back of a phone package in advance.
This is the second change that Verizon has made this year to its policy regarding the use of Prepaid LTE phones on other services. The one month rule was instituted on January 17, 2016. Before that there were no restrictions on using Verizon Prepaid phones on postpaid or on Verizon MVNOs. The LTE phone policy was in sharp contrast Verizon's long standing rule that non-LTE (3G) Verizon Prepaid phones must be used on Verizon Prepaid for six months before they can be used on Verizon MVNOS
I believe that Verizon adopted its original liberal unlocking policy for prepaid LTE phones to comply with the open access provisions of its Block C (band 13) LTE license. In January Verizon got away requiring one months payment and now it seems to be pushing the envelope of open access a little harder.
Source Verizon via HowardForums