The Librarian of Congress banned the practice of buying a cell phone and unlocking it last October. Tech News Daily pointed out that the librarian provided a 90-day buffer in which wireless customers could purchase and unlock their phones. That period ends on Saturday.
Basically, when one unlocks a phone, it will free the handset from restrictions which ensure the device will work only on a particular network, meaning any other network that runs on a similar wireless standard will be able to play nice with said handset. Those who travel overseas often would find that unlocked phones are the most ideal route to take, while others prefer to have the freedom to switch carriers anytime they like.
But not everyone will have to make do with locked phones. As Mashable notes, "Verizon's iPhone 5 comes out of the box already unlocked, and AT&T will unlock a phone once it is out of contract." What's more, you can pay full-price for a phone, as opposed to the discounted price that comes with a multi-year contract, to receive it "unlocked from the get-go."