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In a huge turnabout, Verizon is unbundling its service from a phone purchase. This makes total sense for Verizon, which has the best network; the pressure will force other competitors to follow suit, and on network strength, Verizon wins in most (not all) areas.

This is enormous news for the cell phone industry. I suspect we'll ultimately see little to no bundling, other than some sort of very basic freebie phone, which is all to the good. Consumers complaining that they won't get cheap phones aren't thinking things through; the phone company wouldn't give you the phone if they didn't expect to get it out of your hide in phone fees.

I suspect that this will put enormous pressure on Apple's sweetheart deal with Cingular, as customers begin thinking of a phone as something that doesn't necessarily come attached to a two-year contract.

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Megan McArdle is a columnist at Bloomberg View and a former senior editor at The Atlantic. Her new book is The Up Side of Down.

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