What does an unlocked iphone4 mean?

Is it true that you don't need to pay for internet (since you have to have Wi-Fi around to use it if it's unlocked apparently) or any of that stuff that's required on the data plan? I've been wanting one for a while, but my parents can't afford the plan. Also, would it be recommended to buy one on ebay? My parent's plan is verizon, by the way, and I also heard that apple is selling unlocked iphones for a tremendous price.

Unlocked basically mean its not locked to any carrier. So doesn't matter which sim card you put into the phone it will work. And about the Wi-Fi if iim not wrong you can use Wi-Fi no matter if the phone is unlocked or not.

An unlocked iPhone 4 will not work on Verizon's network.

Unlocked phones only work on GSM networks but Verizon uses CDMA.

Verizon also requires a data plan for all smartphones.