Unlocking refers to the process which comes after jailbreaking which breaks the carrier restrictions on your phone, enabling the use of your phone on different carriers. Why do people unlock their phones? There are primarily three reasons.
Firstly, people unlock their iPhones to use them on other networks which they prefer. When the iPhone was launched, its provider inked exclusive deals with different providers to maintain the high price and to tie the phone with an expensive mobile plan. If your current carrier you are on does not offer the phone or the carrier that does offer the whole has poor coverage, you were out of luck. Before the unlocking process that is.
After unlocking, you will be able to ditch the "default" carrier and go to the carrier that you prefer. Perhaps the carrier that has the iPhone has poor coverage, poor speeds or poor customer service. Unlocking your iPhone would mean that you do not have to put up with this substandard deal, allowing you to use your iPhone on your own preferred network for whatever reason, be it loyalty discounts, better coverage or better speed. Unlocking is generally a safe process which is unlikely to cause breakdown if you do it carefully. However, in the event that something does go wrong, you can always restore the phone back to its original state using iTunes for warranty purposes.
Secondly, unlocking your iPhone allows for flexibility when reselling your iPhone. If you choose to sell your iPhone on the open market, you would be severely limiting your selling price by only targeting users of a single network. By unlocking your iPhone, you can not only sell your phone to users of other network carriers in your country, you can also sell it to a global audience using auction services such as eBay. Usability is more or less assured Indeed, flexibility of usage is one of the primary reasons for unlocking your iPhone. Be it for giving to a family member or friend, an unlocked iPhone will offer you flexibility that you never had.
Thirdly, unlocking your iPhone empowers to you use your iPhone when using a different network overseas. Often, it is cost effective to purchase a prepaid SIM card when overseas to avoid the hefty roaming charges on your mobile phone. However, such a method is not possible on an iPhone which is not unlocked. By unlocking your phone, you are able to make calls or data connections for a cheaper price by using the local carrier. This would be especially useful if you will be residing in a foreign country for more than a week. Furthermore, you will be able to keep your main SIM card safely with you at all times to minimize the loss if your phone is stolen.
Unlocking the iPhone is an appealing option to gain the flexibility of location, reselling and carrier choice. Mobile plans and services form a substantial amount of the total costs that you will be paying to maintain your iPhone's connectivity. There is no reason why you should compromise in that aspect.