It seems there's been some renewed interest in the subject of Block C LTE "no locking" provisions after news that the Motorola RAZR will come equipped with a locked bootloader per Verizon's request. About four months ago, I published an article on this very topic. To summarize: Verizon can basically do almost anything it wants with handsets on its network in the name of reasonable network management - subject to a few limitations and caveats.
But before we get into the reasoning for this, let's talk history.
The Block C Auction Of 2008
Back in 2008, the FCC auctioned off a block of the 700MHz wireless spectrum dubbed "Block C." Verizon was the sole purchaser of the block, having bid $4.7 billion to acquire the chunk of spectrum.