Keeping the phone locked gives the carrier leverage over the customer. There will be some percentage who get their subsidized phone and quickly quit paying their monthly bill. Then they can move to another carrier if the phone is unlocked. The original carrier of course is still owed money under the contract but will find it expensive to collect. Locking the device is a tool to prevent this. What's dirty though is carriers not automatically unlocking the phone as soon as the contract ends. It's a way of making switching to another carrier difficult even if you've fulfilled your contract in full.