Because part of your contract is a phone subsidy, around $25 each month. They bundle it inside your plan.
So once you pay off your phone, your bills should go down, but that's common sense, it doesn't work this way with either of the big 3
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T-Mobile USA Planning to Offer iPhone and End Subsidies Within 3-4 Months
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Because part of your contract is a phone subsidy, around $25 each month. They bundle it inside your plan.
So once you pay off your phone, your bills should go down, but that's common sense, it doesn't work this way with either of the big 3
But still with contract
If I am not mistaken, they will offer plans for a bit less, but you are still committed to a 2 year contract. I don't see a reason to pay full price, and still commit to a contract. Which probably means there will be ETF if you decide to leave.
Anyway T-Mo is only 3 years later then the other providers to offer iPhone.
If I am not mistaken, they will offer plans for a bit less, but you are still committed to a 2 year contract. I don't see a reason to pay full price, and still commit to a contract. Which probably means there will be ETF if you decide to leave.
Anyway T-Mo is only 3 years later then the other providers to offer iPhone.
Logic says you are correct but your contract does not. And current laws (which I agree need to be changed) say your contract wins over logic
As for this 'news', I'll believe it when Apple announces it. Regardless of WSJ, some t-mobile rep etc
It's odd, but there's likely going to be grumbling here in the US should other carriers follow T-Mobile's lead - it sure seems like it'd be a better deal for most people, but perception is a funny thing.
Those of you that upgrade your phones every 18-24 months, though, are going to be unhappy.
No subsidy would mean unlocked phones from the get-go like overseas, right?
I would certainly hope so, but I really wonder if American carriers would be willing to allow it.
-- N
I would certainly hope so, but I really wonder if American carriers would be willing to allow it.
-- N
Because being out of contract means that the subsidy for you phone has been fully covered.
The monthly cost of US plans tends to include money to cover that subsidy for the phone. And usually winds up costing you more than the phone would.
An iPhone 5 costs $649 from Apple.
You enter a 24 month contract and you are told that you get a free iPhone 5.
In reality, the carrier pays $649 to Apple, and the bill for the service is $27 higher than it should be, so that other 24 months you pay $649 to the carrier.
Actually, your bill is $40 higher than it should be, and 24 x $40 - $649 is profit for the carrier.
After 24 months, you have paid for your iPhone. There is no reason why you should continue paying the high rate. Consider this: You could (A) continue using your iPhone 5 for another two years. Or (B) cancel the contract, put your iPhone 5 into a drawer, get an iPhone 6 or 7 for "free" and start a new two year contract. Since (B) is $649 more expensive for the carrier, why should they charge the same amount for (A)?
You and I could sit and have a long, long talk. I feel the exact same way because I'm in the exact same position. My first few bills were upwards of $85... When I had AT&T, they thought I was privileged to be staying with them post-contract.
I talked them down to $65 with two discounts shortly in to my contract, but I only had 200mb of Data, 200 texts, and 450 minutes a month. After 2 and a half years with an iPhone 2G, I signed up with another contract when I got a launch day iPhone 4. (I wouldn't have even done that if my iPhone 2G's Wifi didn't stop working, but it was impossible to keep on that plan.)
After a very lengthy debate about overage text charges through using the AIM app (I still don't know how they got my AIM message-exchange data) I got them to drop a bill, and my contract went down to $62. (OOH!!!)
When that contract was up, I immediately got Straight Talk. It was a huge fiasco to get MMS to work after 3 months without it, I had to switch over to YouMail because there is no native Visual Voicemail support, and I still constantly have to toggle Airplane mode on and off at least once a month because it errors out when connecting to cell data. At least that was $45 for unlimited everything.
The only reason I'm not on T-Mobile yet is no Visual Voicemail support. Not even YouMail works on a relative's T-Mobile iPhone 4. At this point, I don't care at all. For $30 a month, I can get 100 minutes, unlimited text, and unlimited web. If they carry the iPhone, they will either implement Visual Voicemail or provide a solution for those that have the iPhone on a prepaid plan. Until then, for $30, I can call my voicemail like I used to.
This major contract bull with AT&T / Verizon / Sprint is for the birds. My parents got Virgin Mobile long ago and have been happy. When I call them, the quality of their $20-$40 flip phones is no different than if they had a $200 smart phones, and they aren't paying an arm and a leg each month. Heck, they don't even have a bill each month - it's $20 every 3 months.
T-Mobile has me as a customer as of February 1st. No more contracts, no more major carrier games, no more obscene fees. Each year the new iPhone comes out, I get the previous year's iPhone at half the price, and put it on a cheap prepaid plan. No headache switching over to the Lightning connector when I have a collection of 30-Pin docks and cables, and no huge upfront cost or marked up high-demand in the Marketplace here. A year old phone on a prepaid plan, upgraded to the next phone each year. Suck it, carriers.
Holy crap, my posts are always long-winded.
It will get interesting when Amazon
1) makes its own smartphone
2) makes its own version of Wal-Mart Straightalk (something like $40 a month for unlimited talk, text and 2.5 GB of data as a T-Mobile MVNO)
If Amazon No Contract Wireless get 2-3% margin, that's in line with their overall business.
p.s. It's almost a certainty that Amazon will jump into the smartphone business. It's just a matter of when.
And like Google selling Nexus devices at cost, Amazon will likely too.
1) makes its own smartphone
2) makes its own version of Wal-Mart Straightalk (something like $40 a month for unlimited talk, text and 2.5 GB of data as a T-Mobile MVNO)
If Amazon No Contract Wireless get 2-3% margin, that's in line with their overall business.
p.s. It's almost a certainty that Amazon will jump into the smartphone business. It's just a matter of when.
And like Google selling Nexus devices at cost, Amazon will likely too.
I'm looking at doing the same thing. My out-of-contract AT&T iPhone4 works just fine, but I'm still paying for it every month. Since AT&T doesn't offer just-voice-and-data plans (only voice-and-data-and-1/24-of-a-phone plans), T-Mobile's value plans are looking attractive.
The big difference is that in Europe, with the unsubsidized phones comes the freedom to choose any carrier you want. Here, you have to buy a phone specific to the carrier. If you get an unlocked GSM phone, then you can either choose AT&T, T-Mobile, or one of the pre-paid plans using their network. Not really that much choice for the consumer.
So if Verizon starts doing this, then you'll be stuck with your a $650 paperweight if you decide you want to leave for another carrier. I think VZ likes locking people into contracts too much to follow through with this. It'd be more fair if the government forced carriers to have compatible LTE, so a consumer can switch out LTE cards to switch service like unlocked GSM phones. Seeing as this is never going to happen, I'm not thrilled with the prospect of carriers ditching subsidized phones.
I'm with VZ for the time being, but if they ever revoke my unlimited data I will buy a Nexus and use go the GSM prepaid route. Hopefully Google is the one who buys Dish Network and offers an affordable wireless plan.
So if Verizon starts doing this, then you'll be stuck with your a $650 paperweight if you decide you want to leave for another carrier. I think VZ likes locking people into contracts too much to follow through with this. It'd be more fair if the government forced carriers to have compatible LTE, so a consumer can switch out LTE cards to switch service like unlocked GSM phones. Seeing as this is never going to happen, I'm not thrilled with the prospect of carriers ditching subsidized phones.
I'm with VZ for the time being, but if they ever revoke my unlimited data I will buy a Nexus and use go the GSM prepaid route. Hopefully Google is the one who buys Dish Network and offers an affordable wireless plan.
Are you serious, the contract price pays for the handset. Once you are out of contract the handset is payed off and you should get either a new handset with new contract or a cheaper price plan. That is the way it works here in the UK anyway, when your contract expires you can get moved onto a cheaper sim only type price plan with most operators. Paying the same price after the handset is paid for is a rip off.
Sooo... Right about the time the 5S comes out?
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FWIW I'll be taking T-mobil's bait. Wife & I had T-mob for years & it was pretty great. Service wan't the best, but dollar for dollar, the plans were. I waited and waited for iPhone to come to T-mob, then when I heard ATT might buy out the T-mob branch of DT I was like well, "F it" cause it'll probably happen anyway. Then it didn't. So here I am stuck on ATT. Which admittedly, hasn't been as bad as the collective interwebs made it out to be, but then again, I live in ATTland. But of course I'm getting shafted by the crappy plan. I'll take slightly sub-par area coverage with unlimited at a good price and pay upfront for the product, thanks. Although I'm not a big enough sucker to go run to StraightTalk. I'm going to save in the scheme of things too cause I don't upgrade every year or even every other year. I go to ifixit.com and take care of my belongings.
I'll probably save even more (well, not spend as much...) because I'm suspecting this is going to be synced with the release of 5S, and I'll just get the 5 (& wife will get the 4). I can't imagine the 5S is going to have any killer feature that I'll just have to have. So that's my plan, and I'm... eh never mind. We'll see what happens.
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FWIW I'll be taking T-mobil's bait. Wife & I had T-mob for years & it was pretty great. Service wan't the best, but dollar for dollar, the plans were. I waited and waited for iPhone to come to T-mob, then when I heard ATT might buy out the T-mob branch of DT I was like well, "F it" cause it'll probably happen anyway. Then it didn't. So here I am stuck on ATT. Which admittedly, hasn't been as bad as the collective interwebs made it out to be, but then again, I live in ATTland. But of course I'm getting shafted by the crappy plan. I'll take slightly sub-par area coverage with unlimited at a good price and pay upfront for the product, thanks. Although I'm not a big enough sucker to go run to StraightTalk. I'm going to save in the scheme of things too cause I don't upgrade every year or even every other year. I go to ifixit.com and take care of my belongings.
I'll probably save even more (well, not spend as much...) because I'm suspecting this is going to be synced with the release of 5S, and I'll just get the 5 (& wife will get the 4). I can't imagine the 5S is going to have any killer feature that I'll just have to have. So that's my plan, and I'm... eh never mind. We'll see what happens.
I think that VVM, MMS, 4G (already exists), 3G will work. The issue is that they are still refarming their market, and that features like VVM are only supported when T mo becomes an official iPhone carrier. Thus this feature should be "turned on" when they get the iPhone.
This is slightly off topic but,
is Tmobile reframing their network for current iPhone users to have 3G and HSPA+ EVERYWHERE or just mainly in the popular cities among the USA? As an iPhone 4s user, I would like 3g mainly for GPS purposes, 2g is rather slow. However, I may get an iPhone 5 or later if this article is true.
is Tmobile reframing their network for current iPhone users to have 3G and HSPA+ EVERYWHERE or just mainly in the popular cities among the USA? As an iPhone 4s user, I would like 3g mainly for GPS purposes, 2g is rather slow. However, I may get an iPhone 5 or later if this article is true.
Ok, then why is it that when you buy an iPhone off contract your monthly bill is no less than someone who bought on contract? I have NO problem paying for an iPhone 5 at full price from at&t but I want my monthly bills LOWER to go along with it. I sold phones for Cingluar and I remember selling great plans for 39.99 a month.
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This is exactly what I was about to post. They'll act like the current base rates will be a perk to anyone paying full price up-front for the phone. If you finance, it'll add the extra $20-30 to your bill. Either way, the consumer loses.
For example, right now: You pay a $200 subsidized price for your iPhone 5 + $100 a month for service for 2 years on contract. ($2600 total cost of ownership for 2 years)
In the future, you have two options.
Option 1: Pay $650 upfront for your iPhone 5. Then $100 a month for service for 2 years. ($3050 total cost of ownership for 2 years)
Option 2: Finance the phone over 2 years. $100 a month for service for 2 years + $27.08 a month for 2 years to pay off the phone (Assuming it is interest and fee free). ($3050 total cost of ownership for 2 years).
So, unless the carrier offers about $18.75 off your bill each month for buying or financing an unsubsidized phone, it will cost the consumer an extra $450 over 2 years for an iPhone 5 16GB. If you have multiple phones in your household, the cost would greatly increase.
Perhaps the trade-off is being contract free, but due to GSM/CDMA, you are still kind of limited. Seems like a lose-lose for consumers in the short term, at least.
Except I can take my Verizon iPhone 5 to any GSM carrier in the US (even international) at anytime and it works fine...even under contract. LTE won't work domestically due to the difference in bands, but that's a spectrum issue, not any company policy. LTE will work overseas in very limited markets.
Mad Mac Maniac
macrumors 601
Not sure if someone answered you already but...
Well that's the problem with AT&T they won't lower the price just because you didn't use a subsidy. You are basically just giving at&t free money or paying for other peoples subsidies. That's why T-mo is trying the idea of no subsidies, but lower monthly prices. It's more realistic that way.
The only advantage that I could see buying off contract with AT&T is that you wouldn't be locked in for as long. I'm pretty sure at&t still requires a contract though... probably just shorter term would be possible.
The CEO of TMo is hardly "some t-mobile rep"...
There's been a technology problem that has prevented them from offering it.
Uh... Well, that's not what's happening right now. TMo is offering rates that are better than $20 less per month, with an explicit financing option of $20 or $25 per month for 20 months, plus the balance as a down payment. For my wife and I, to have data and texting on both our lines, plus 700 shared minutes, we were spending $160 a month. Switching to TMo, our plan has dropped to $90 a month. When they come out with iPhones, we'll probably get them on financing, which will bring our monthly bill to $130.
Given the nature of the telecom industry, I can understand being a bit pessimistic, but I see this as a positive. Over the past ten years, my wife and I have had subsidized phones for exactly two years. The rest of the time we either were using the phones that we had, or we bought unlocked phones because we weren't satisfied with the features on the phones available from AT&T. So, effectively, we've paid for ten phones, but only received two. If we assume that the cost is about $20 per month per line, then the eight years that we've been out of contract with AT&T has represented paying them $3840 more than their services actually cost. That's a chunk of change. So, as I said, I'm optimistic about this, at least for now...
That's an original strategy on their part. I've never heard of anything like that in Canada. Of the big providers here, all the plans cost the same and the contracts are 3 years and not 2.