So you're paying $324 for a $199 device just so you can upgrade a year early. Works only if it's in your budget.
Well this plan only works if you're upgrading annually. It is completely pointless if you upgrade every 2 years or more.
The way to compare it is:
$324 per year for a new phone every year.
Vs.
$199 for a phone the first year and $650 for a phone on your 2nd year.
So compare:
$650 out of pocket vs $850 for annual upgrades.
At this point, don't confuse yourself with in the built in $20 month subsidy in the bill because that's already figured in at this point.
Why AT&T Next is a ripoff:
1) You don't keep the old phone. This becomes basically a lease.
2) Eventually you have to "exit" the program and pay off the final device which you'll keep. This is effectively overpaying by hundreds of dollars because you're not getting any advantage of subsidy.
3) If you just buy your phones every year and sell the old one, it would cost you less.
A) Buy Phone #1 at $199.
B) Buy your upgrade (#2) at $650, sell the old one for about $300.
C) Over 2 years it cost you about $550 to buy and sell the old phone vs $650 to be on AT&T Next (aka $275/yr vs $325/year.) And should you decide to not upgrade every year, you aren't penalized. Selling on gazelle.com for $300 on a 1 year old iPhone is almost hassle so there's no excuse to make these numbers work.
Also, AT&T will give you 1/2 subsidy to upgrade early (after 12 months.) So instead of paying $199 you'd pay $399 if you upgrade at 1 year. AT&T gives you $450 subsidy per year (or $225 per year as early upgrades.)
So by that math, you'd be paying $400 per year to OWN and keep devices (after the first year at $199) vs paying $325 per year on AT&T Next where you do NOT keep your devices. And remember you can always sell that old phone for about $300 on gazelle making it again better/cheaper to buy than use Next.
The scarry thing about Next is that you have to commit to upgrading every year or it's a complete ripoff. Also if you lose that iPhone (or it's stolen) I believe you simply have no choice than to pay it off. You would have paid full price for the phone without getting the advantage of that $450 subsidy. I don't know if Next has any kind of deductible (insurance wise) that makes it so you can get a new phone.
Also under Next there is no contract and therefore not ETF. But paying the ETF on a 2 year contract isn't any worse than just paying full price for the phone which is what you'd don on Next (because you're "exiting" the upgrade program.)
No, I haven't put any thought in to this at all /s
