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GSM stands for Global System for Mobile Communication
GSM is the most popular 2G mobile phone standard worldwide and GSM is one of the two major mobile technologies in the US, with the other being CDMA.
Cingular and T-Mobile use GSM while Sprint and Verizon use CDMA. CDMA is equally as popular as GSM in North America but the numbers are more skewed towards GSM elsewhere around the world, especially in the EU.
One of the main features of GSM is the use of SIM cards. The cards are tiny, removable smart cards which uniquely identify the user as well as store phone book addresses. SIM cards can be used in any GSM phone by simply removing the card and switching it to any other GSM phone. There is no need to activate the new phone which is a necessity if using CDMA.