T-Mobile USA Planning to Offer iPhone and End Subsidies Within 3-4 Months

[d4dawg]

Originally Posted by G4DP

What horshhit! Why should you pay less because you are out of contract. You are receiving the same service and package. Talk about self-importance syndrome.

Your carrier LOVES you.

[vmistery]

Here in the UK once your plan is up you can switch to a sim only deal. My sister has a 3GS and is only paying £7.50 / month on talk mobile

[atsang]

Originally Posted by Noojin

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.

Map of Tmobile 1900mhz refarming progress: http://www.airportal.de/

[rmhop81]

this isn't going to fix the overall monthly cost. just be another way to make more cash for themselves. take away subsidies and they don't have to pay that $400 to apple and keep rates the same. it's a win win for them.

[aliensporebomb]

Public perception is everything. If all the carriers go to this most people will be like "I'm not going to pay $649 for something that cost me $200 two years ago". The big technology cellphone party where everyone updated their device with every new upgrade and iteration that the economy has been helped by for the last few years will be over.

The public perception will entirely depend on TMobile producing some kind of marketing puffery indicating that their monthly bills for subscribers are significantly lower than the other carriers.

If they can't do that and keep the prices the same this isn't a great deal for the average person looking at it on the street.

[rmhop81]

Originally Posted by aliensporebomb

Public perception is everything. If all the carriers go to this most people will be like "I'm not going to pay $649 for something that cost me $200 two years ago". The big technology cellphone party where everyone updated their device with every new upgrade and iteration that the economy has been helped by for the last few years will be over.

The public perception will entirely depend on TMobile producing some kind of marketing puffery indicating that their monthly bills are significantly lower than
the other carriers.

If they can't do that and keep the prices the same this isn't a great deal for the average person looking at it on the street.

yeah like my mother-in-law. it took her years to decide on paying the $49 to get an iPhone 4.....no way in hell she's gonna pay $649 to upgrade her phone when it's time.

You can't get consumers used to paying cheap subsidized phones then shock them at $649. Bc they don't understand that's how much the phones really cost.

[solamar]

Originally Posted by KPOM

This will be VERY interesting. T-Mobile tried something similar a few years ago called Even More Plus, where they knocked $20 off the monthly bill in exchange for no subsidy on the phone. It wasn't popular then, but that was partly because they offered subsidies greater than $240 on their other plans.

Apple is very much a company who has benefited from carrier subsidies. iPhone adoption rates in the US are significantly higher than in Europe, where subsidies are less common and Android phones sell for less. I wonder if this is why we are suddenly hearing all the chatter about a cheaper iPhone (first Digitimes, then the more reputable WSJ and today Bloomberg). Perhaps part of it could be for emerging markets like China, but maybe Apple is also preparing for the days when it won't be able to rely on AT&T and Verizon paying them an extra $100 for their phones.

Even More plus IS the Value plans, which are very popular (I'm on one) and they've had a for a few years.. They cut about $25-30/mo off because you don't get subsidized phones.

What most don't realize is that even though subsidy goes away, the customer is still NOT paying the full price up front. T-Mobile is pushing it as an alternative subsidy.

Meaning, when you go in, they push you to the value plans, then when you start talking phones they tell you it's $150 or $200 down (up front cost) then they tac on $15 or $20 /mo for the phone for 20 months. Sometimes, like over the holidays, they do a $50 or 0 Down and $15 or $20/mo for phone.

In the end it's still a good $20/mo cheeper than Verizon and ATT but you own the phone.

The reasoning is simple. Subsidies get added onto the debt of the phone company. It something that hangs over their heads because they pickup the phones costs.. This way, the phone's cost is completely on the consumer, but they don't have to pay all up front. It goes on their credit with t-mobile as a payment plan.

Win/Win - customer owns the phone/unlocked with cheeper month to month plan and t-mobile looks a lot better on the books. Customer can pay off the phone anytime and no interest on the phone's payment plan and payment is tied into phone bill. Try that with a credit card these days, you really can't and ATT / Verizon offer no incentives / alternative plans when buying your phone outright.

[Ryth]

Both carriers do, however, acknowledge that customers are so conditioned to low upfront device costs that it may prove a significant hurdle to overcome.

Conditioned? Please.

The correct term is 'stupid'...sorry but it's true.

If coverage is the same and you aren't one of these individuals that HAS to have data at lightning speeds at all times, then you are just throwing your money away on AT&T and Verizon plans.

And if you can afford those monthly plans of $100+, then you sure as heck can afford an upfront payment of $650. But most people are just clueless about saving money over time vs that day.

For me and many others, it's just simple math that we buy upfront and take it to T-Mobile or other paygo carriers to save us $700+ over 2 years easily.

[rmhop81]

Originally Posted by solamar

Even More plus IS the Value plans, which are very popular (I'm on one) and they've had a for a few years.. They cut about $25-30/mo off because you don't get subsidized phones.

What most don't realize is that even though subsidy goes away, the customer is still NOT paying the full price up front. T-Mobile is pushing it as an alternative subsidy.

Meaning, when you go in, they push you to the value plans, then when you start talking phones they tell you it's $150 or $200 down (up front cost) then they tac on $15 or $20 /mo for the phone for 20 months. Sometimes, like over the holidays, they do a $50 or 0 Down and $15 or $20/mo for phone.

In the end it's still a good $20/mo cheeper than Verizon and ATT but you own the phone.

The reasoning is simple. Subsidies get added onto the debt of the phone company. It something that hangs over their heads because they pickup the phones costs.. This way, the phone's cost is completely on the consumer, but they don't have to pay all up front. It goes on their credit with t-mobile as a payment plan.

Win/Win - customer owns the phone/unlocked with cheeper month to month plan and t-mobile looks a lot better on the books. Customer can pay off the phone anytime and no interest on the phone's payment plan and payment is tied into phone bill. Try that with a credit card these days, you really can't.

who is to say the plans will be any cheaper with AT&T or Verizon? If people are going to get loans and tack on extra money, why get rid of the subsidy? People don't understand the true cost of cell phones nowadays. My mother-in-law would barely pay $49 to get an iphone 4 and she thinks that's how much they cost. When she wasn't due for an upgrade we offered to sell a 3GS back in the day for $125. she said we were ripping her off basically bc she could get it cheaper at walmart or radioshack for free or $49. she didn't understand the true cost of the phone. I don't see how this will go over well. Here sir, your bill will be $79.99/month and you pay us $649 for the device. people will not be buying iphones anymore like they have been.

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Originally Posted by Ryth

Conditioned? Please.

The correct term is 'stupid'...sorry but it's true.

If coverage is the same and you aren't one of these individuals that HAS to have data at lightning speeds at all times, then you are just throwing your money away on AT&T and Verizon plans.

And if you can afford those monthly plans of $100+, then you sure as heck can afford an upfront payment of $650. But most people are just clueless about saving money over time vs that day.

For me and many others, it's just simple math that we buy upfront and take it to T-Mobile or other paygo carriers to save us $700+ over 2 years easily.

while stupid sure...but it's not like there are tons of options out there man. I've gone back and forth between carriers and done prepaid etc. yes there are cost savings to do prepaid, but there are also headaches as well. We don't have much choice here in the USA. Now if we had tons of choices i would agree with you. You aren't comparing equal services. T-mobile is a joke on iphone, edge data vs. LTE come on.

People don't understand the true cost of phones bc of the subsidy. All they see is iPhone free, $99, or $199. If you told them they'd have to pay $449, $549, or $649 to use the same phone do you think these people will jump at the chance? Who is to say these companies will even discount their service bc of the lack of subsidy.

[KPOM]

Originally Posted by Ryth

Conditioned? Please.

The correct term is 'stupid'...sorry but it's true.

If coverage is the same and you aren't one of these individuals that HAS to have data at lightning speeds at all times, then you are just throwing your money away on AT&T and Verizon plans.

And if you can afford those monthly plans of $100+, then you sure as heck can afford an upfront payment of $650. But most people are just clueless about saving money over time vs that day.

For me and many others, it's just simple math that we buy upfront and take it to T-Mobile or other paygo carriers to save us $700+ over 2 years easily.

It's not that simple. A lot of us get our phones using employer-negotiated discounts, and some of us have grandfathered unlimited plans. I'm paying about $60/month (tax included) for an old AT&T plan with unlimited data. While the $70 Unlimited T-Mobile plan sounds good compared to new AT&T plans, I'm better off right now staying with AT&T. Plus, if they will pay $450 toward my next iPhone while T-Mobile won't, why not just take the subsidy?

[TheHateMachine]

Originally Posted by SVTVenom

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.

The thing is it will still be a contract until you fully pay the phone off.

This is why MVNOs are getting more popular. Same service but at half the cost. T-mobile's prepaid is only 35 a month and Straight talk is 45 a month. I honestly do not see why people stick with the big carriers. As soon as my contract runs out I am ditching for one of the sub $50 MVNOs.

[rmhop81]

Originally Posted by TheHateMachine

The thing is it will still be a contract until you fully pay the phone off.

This is why MVNOs are getting more popular. Same service but at half the cost. T-mobile's prepaid is only 35 a month and Straight talk is 45 a month. I honestly do not see why people stick with the big carriers. As soon as my contract runs out I am ditching for one of the sub $50 MVNOs.

bc you don't get the same service. people act like everything is equal here. I've done Red Pocket, H20, and Straight talk....all AT&T MVNO. If you don't sign up for autopay...they all bug the living crap out of you texting, emailing and even calling you several times a month just to renew your minutes. That alone bothered me that i dropped them and went back to postpaid so i wouldn't be bothered. Data speeds are not reliable either. IF it were completely equal then yes it makes sense...

[Fezwick]

This is good news. I have an iPhone 4 on Page Plus (Verizon MVNO) and the service is just as good as Verizon postpaid. $30 a month for 1200 minutes/3000 texts/250mb data is a pretty good deal. When I was with AT&T I was paying upwards of $70 a month for less than what I get now. I'd rather pay for the phone outright then get screwed on a two year contract.

Only problem with Page Plus is no 4G data yet. I've heard that it's coming soon.

[Prof.]

So I pay $649 for my new iPhone, and then I pay less per month for my service than I am now...? I can make that work.

[jacobseric]

Wow... it amazing to me how many people commenting on this thread don't get it. T-Mobile will offer the iPhone for the same price (or slightly less) than AT&T, Verizon and Sprint -- but after two years of paying off the loan for the phone, subscribers bills will drop. (Or people can choose to pay the full cost of the phone upfront and take the lower bill from the start.)

I love this approach, and would gladly switch to it once my two-year iPhone 5 contract with Verizon is up. I don't always need a new phone every two years, and would be happy to pocket the savings for a year or two until my phone either fell apart or the lure of new technology lead me to replace my phone.

So it's interesting that no one has noted that the real loser in this plan is Apple and the other phone makers -- because fewer people will replace their phones at exact two-year intervals. Currently, there is no incentive for US users not to get a new phone as soon as your contract allows. Under the loan-not-subsidy model, there's a roughly $20 per device per month incentive to hold onto your old phone. If my wife and I kept our phones for a third year, we'd save nearly $500. And Apple (and others) will sell fewer phones in the US because we won't all replace our phones every two years.

[drewyboy]

Originally Posted by G4DP

What horshhit! Why should you pay less because you are out of contract. You are receiving the same service and package. Talk about self-importance syndrome.

Apparently you don't understand how cellphone bills are broken down. You plan include you paying $X to "pay back" the subsidy that the telco paid up front, so you are getting your 0% financing with paying for the phone built in. Now when the contract ends (reason you're in a contract is so the telco gets their subsidy back), I should not have to be paying that built in subsidy price. It should go down $20-30 from current payments. I'm not belittling you or acting like your stupid. I hope that you no become informed and as outraged as most of us are once you understand what your cell phone bill REALLY consists of.

[skellener]

I would rather pay more up front once for the device, be free of any two year contract and have low monthly payments for the service - especially being able to pick a plan with less minutes since I don't use the phone that much. Right now, with ATT, Sprint, Verizon you are looking at $100. a month plans with a new iPhone (with no way to reduce the phone line minutes part). If T-Mobile can bring lower priced plans with less minutes and no contract - I'm in.

[drewyboy]

Originally Posted by SkippyThorson

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....

...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.

Yes, yes we could! He's my deal. I'm going to be moving to T-Mo here soon w/ their "online only" plan that has the 100 min, unlimited text and unlimited data (first 5gb @ 4g speeds ) and here's the kicker... I'm putting together my own simple ios app that uses Twilio for outgoing calls @ a quarter of cent per minute! Of course using my unlimited data for the connection I've been tracking my cell usage and I only use about 200 minutes a month. So any outgoing calls will be using twilio, and incoming will be regular. Outgoing will also be "masked" with my verified number so when I call out using twilio it will show up w/ the same number. You don't need to use twilio for this, there's a few others but twilio had a nice ios sdk. I'll be holding onto my iPhone 4 till the next one comes out and plop down for those delicious 4g speeds!

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Originally Posted by npro1464

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.

Not necessarily true. Verizons 4g Lte requires a gsm card (at least from my understanding) so they are finally leaving all the old network behind in a sense. I think that's what we'll get with the next version (5s) or after that (6?)... a true "world" phone thanks to 4g lte.

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Originally Posted by intothepolis

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.

That's because almost no carrier allows a Bring your own device w/ smartphones, especially the iPhone. Att has a byod but if it's a smartphone, they automatically change your plan. So it's the telco's screwing you and me over... that's why. And that's why straight talk is so cheap.

[donniedarko]

Notice how rumour mill is discussing cheaper variants of the iphone, which time wise seems sensible to this shift in subsidies. Its always disgusted me the shoel contract thing and expense of phones. The market is getting more honest now. Thanks god for Straight Talk I dont feel like Im getting bull raped everytime I pay my bill now, especially since Ive always made a point of now being on contract with ANY carriers. Kudos to ST and TM for getting with it.

[rmhop81]

Originally Posted by jacobseric

Wow... it amazing to me how many people commenting on this thread don't get it. T-Mobile will offer the iPhone for the same price (or slightly less) than AT&T, Verizon and Sprint -- but after two years of paying off the loan for the phone, subscribers bills will drop. (Or people can choose to pay the full cost of the phone upfront and take the lower bill from the start.)

I love this approach, and would gladly switch to it once my two-year iPhone 5 contract with Verizon is up. I don't always need a new phone every two years, and would be happy to pocket the savings for a year or two until my phone either fell apart or the lure of new technology lead me to replace my phone.

So it's interesting that no one has noted that the real loser in this plan is Apple and the other phone makers -- because fewer people will replace their phones at exact two-year intervals. Currently, there is no incentive for US users not to get a new phone as soon as your contract allows. Under the loan-not-subsidy model, there's a roughly $20 per device per month incentive to hold onto your old phone. If my wife and I kept our phones for a third year, we'd save nearly $500. And Apple (and others) will sell fewer phones in the US because we won't all replace our phones every two years.

if this is what the future brings, u can be sure that many people that have iphones now will no longer have them in the future. they don't think the true cost of the device is $649. also, this is tmobile you're talking about.....you think AT&T or Verizon is gonna do the same thing? It's just a way to get the liability off of them and make more money.

Regardless if it comes out to the same price or not, when someone sees that $649 they may rethink having a cell phone in general.....at least the iphone.

Their thinking will be, I have to pay $649 to use the device AND pay $100/month?

[Rodimus Prime]

If AT&T and Verizon would offer lower plan cost with the end of subsidies I would gladly do it and even sign a contract for the lower rate lock in.

[honjoe]

If AT&T and Verizon did sold iPhones unsubsidized then iphone sales will take a hit. More people will opt for a cheap phone like nexus 4 and even pick prepaid carriers like cricket or Virgin.

[cheezeit]

I'm up for cheaper plan rates and bringing your own phone. Most of the market will be in shock though...

[rmhop81]

Originally Posted by Rodimus Prime

If AT&T and Verizon would offer lower plan cost with the end of subsidies I would gladly do it and even sign a contract for the lower rate lock in.

why would u sign a contract? lol

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Originally Posted by cheezeit

I'm up for cheaper plan rates and bringing your own phone. Most of the market will be in shock though...

yes they will. you can say goodbye to all the mom and pops with iphone bc they got them free. they aint paying $500 for a cell phone.

[Rodimus Prime]

Originally Posted by rmhop81

why would u sign a contract? lol

if signing a contract meant I got a lower rate over non contract price and lock it in damn straight I would sign it.