There are two types of wireless technology that cell phones in the US currently use, GSM and CDMA. AT&T and T-Mobile uses GSM, while Verizon and Sprint use CDMA. GSM phones use SIM cards to store your phone number and subscriber information, while CDMA phones do not use a SIM card, all the required information is programmed directly into the phone itself.
CDMA phones need to be flashed with the appropriate image before it can be activated on the network. Flashing is reprogramming phones from another CDMA carrier to be supported by another carrier. Flashing is not easy, it requires technical skill, proper software, hardware and it has the risk of bricking the phone or getting only partial functions like talk and text only.
A phone must be unlocked to activate to another provider. Most major U.S. wireless providers lock their phones and will only unlock if customers have been a customer with good records for a certain period of time, or if they have purchased the phone at full price. They can also have it unlocked by someone for a fee.
post made available thanks to Jason from PrepaidCellForum.com