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Old Jul 18, 2013, 04:44 PM   #26
HiRez
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This is great, now we all have a choice of different flavors of the same crap. Yay?
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Old Jul 18, 2013, 04:47 PM   #27
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I just don't understand why they can't offer the same rates as T-Mobile or even cheaper. Then again, if I was a shareholder, I'd be screwing you too because I want money.
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Old Jul 18, 2013, 04:54 PM   #28
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Originally Posted by Chupa Chupa View Post
Leasing is usually more expensive than buying but lease payments are less than loan payments. That's why most people lease. Also they like the fact they don't have to hassle with selling the car or getting a low ball trade-in.
Not to mention you can get a nicer car for the same amount and/or get a new car every few years.

The whole idea of leasing a phone doesn't inherently turn me off. It's the double-speak from the carriers. In the traditional model, about $20/month went to paying for the phone subsidy ($650 for a 16GB phone - $200/ 24 months = about $20/month).T-Mobile's plan reduces the monthly service by that $20 once the phone is paid for. From everything I've read, AT&T and Verizon don't, even though for years we were told that part of our monthly service fees covered the phone.

I don't have an issue with the idea of renting/ financing of a cell phone.

I don't have an issue with paying for goods & services.

I DO have an issue with paying for the same thing twice.
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Old Jul 18, 2013, 06:06 PM   #29
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I'm moving my wife's line over to T-Mobile in a couple of months.

T-Mobile has better plans, the service is good in my area, and since AT&T only gives me a 30% discount on one line, adding a line to T-mobile gives me an additional 15% discount on that line.

I'll be saving quite a bit of money.
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Old Jul 19, 2013, 12:28 AM   #30
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well, so much for competition or should I say what an act of collusion.... Got to love how these carriers copy each other on almost everything.
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Old Jul 19, 2013, 08:37 AM   #31
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The comment comparing VZW and AT&Ts plan to a car lease got me thinking. When you trade in the phone, does it have to be in decent shape? I'm guessing that it has to be in working order, but what about dents and scratches and missing buttons (I'm looking at you Moto RIZR Z6)?

I see where TMo's plan calls for a $10/mo insurance fee, so I guess with TMo, you could beat up your iPhone and they'll still take it back.

I'm not too convinced that VZW and AT&T wouldn't refuse a slightly scratched phone when it comes time to trade it in.
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Old Jul 19, 2013, 10:30 AM   #32
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I believe it's time to start weighing the jump from VZ to TMO. 2 of my 3 lines are up for upgrade, but I'll have to dump $350 or whatever it is for an EFT for this total POS Pantech Marauder "smart phone". It's so ghetto you'd think it's for Jump or Cricket. My old BB Pearl is still a better "smart phone" and I haven't used it in 4/5 years.
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Old Jul 19, 2013, 10:40 AM   #33
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so basically Verizon announced a way to double dip on customers. First we have to pay for phone subsidies threw increased contract price but to take part in Edge we would still be paying that plus a fee for edge plus the cost of the phone.

We the consumer still get screwed.
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Old Jul 19, 2013, 03:38 PM   #34
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Unfortunately, I see a lot of misinformed customers falling for this.
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Old Jul 19, 2013, 04:01 PM   #35
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But, unfortunately, a lot of us will end up doing these plans, because we don't want to have to wait the full 24 months to get another phone (since they're more strict with the upgrade timeline now), and don't usually have $650 to just plunk down in a lump sum for a new phone (although even if you do, you're still double paying anyway).
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Old Jul 19, 2013, 05:37 PM   #36
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Originally Posted by ghostface147 View Post
I just don't understand why they can't offer the same rates as T-Mobile or even cheaper. Then again, if I was a shareholder, I'd be screwing you too because I want money.
They can't because their costs are much higher. They have the largest cell network in the US. That costs millions more every year to build and maintain. They spend millions more every year on call quality measurements and on customer service. Yes they have shareholders, who expect a return on the very large investment that they have made. Want the best service ....That's what it costs.

----------

Quote:
Originally Posted by jdechko View Post
Not to mention you can get a nicer car for the same amount and/or get a new car every few years.

The whole idea of leasing a phone doesn't inherently turn me off. It's the double-speak from the carriers. In the traditional model, about $20/month went to paying for the phone subsidy ($650 for a 16GB phone - $200/ 24 months = about $20/month).T-Mobile's plan reduces the monthly service by that $20 once the phone is paid for. From everything I've read, AT&T and Verizon don't, even though for years we were told that part of our monthly service fees covered the phone.

I don't have an issue with the idea of renting/ financing of a cell phone.

I don't have an issue with paying for goods & services.

I DO have an issue with paying for the same thing twice.
What if are we not paying for the same thing twice? What if that extra is to cover the cost that you don't have a contract and as such are not a committed source of income. Compare a apartment on a month to month agreement and a lease. The Month to month is higher because you are not a committed source of income.
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Old Jul 19, 2013, 10:43 PM   #37
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Originally Posted by freediverdude View Post
But, unfortunately, a lot of us will end up doing these plans, because we don't want to have to wait the full 24 months to get another phone (since they're more strict with the upgrade timeline now), and don't usually have $650 to just plunk down in a lump sum for a new phone (although even if you do, you're still double paying anyway).
Really? I can think of things that are hard to wait 2 years for, but a phone is not one of them.
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Old Jul 20, 2013, 11:32 AM   #38
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Really? I can think of things that are hard to wait 2 years for, but a phone is not one of them.
+1

If you are the only person on your plan then this might be an option. But most people roll with a family plan of some sort so they can hand down devices, swap upgrades, etc.

At least that's what I do. With 4 lines on my plan with contract dates scattered I can upgrade annually if I want and just hand off my current device to my mom or my mom-in-law and they think they're getting an upgrade.
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Old Jul 20, 2013, 01:10 PM   #39
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you can go to t-mobile, pay a lot less, upgrade your phone once every 3-4 years and just buy a new ipad every year and still save money
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Old Jul 22, 2013, 03:04 AM   #40
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At least in the US there is a way to upgrade before the end of the contract, Australia is still stuck in the dark ages.
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Old Jul 22, 2013, 12:17 PM   #41
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Here's What you're Missing

Quote:
Originally Posted by BreuerEditor View Post
What am I missing? You pay the phone's price over 2 years (so let's take an iPhone worth $700), and you're paying $350/year, but in order to upgrade in 6 months time, you have to fork up the total $350 price tag AND trade in your phone...so essentially, you're renting a phone, but if you keep it for 2 years, you've paid it in full and you STILL have to trade it in??
You're right that this costs more than just buying the phone outright when you upgrade (based on the article description), but here's what you are missing.

Most consumers will assume it's a good deal without fully understanding the program. Others will understand the terms but are sufficiently lacking in personal finance skills that they are willing to pay a hefty premium to finance upgrades over a year rather than saving up just 75% of that amount and paying cash.

I call this a "fool's tax," even though there are times doing so can make sense (depending on how much more productive you can be with the additional features.)
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Old Jul 22, 2013, 01:28 PM   #42
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Originally Posted by tdar View Post
What if are we not paying for the same thing twice? What if that extra is to cover the cost that you don't have a contract and as such are not a committed source of income. Compare a apartment on a month to month agreement and a lease. The Month to month is higher because you are not a committed source of income.
Then the carriers have been lying to us all along.

It's really simple math. We've been sold subsidized devices while being told that part of the monthly fee is going to paying off the subsidy.

Exhibit A
If a non-contract iPhone cost $650 and you only pay $200 in the store for it, where is the extra $450 coming from?

Answer: It's pretty obvious that they're not writing it off. So it must come from your monthly fee.

Exhibit B
Early Termination Fees: If you break your contract early, you have to pay to "cancel your contract"

Answer: It costs the carriers very little to remove you from their system. But that's not the reason for the ETF. Since we already know the carrier isn't going to write off the remaining amount of the phone, the logical answer is that the ETF covers any remaining portion of the device itself. Standard ETF on a smartphone is $350 (The difference between the cost and ETF can be explained by volume discounts. A discount of $100 per phone when you are buying millions seems reasonable). Fortunately, the carriers also reduce the ETF for each month you've paid into the contract (and paid off your phone). By around the 20th month, you've completely paid off the phone and no longer have an ETF.

Exhibit C
T-Mobile: T-Mo actually separates the cost of the device from the cost of the service. The new service plans have been reduced in cost compared to the old model where the subsidy is included in the monthly fee.

Since the rates of AT&T and Verizon are the same no matter which method you choose (traditional vs outright purchase). It's logical to conclude that customers are being double charged for the pleasure. I suspect that we may see some changes to these plans in a year or so after the carriers realize that the target audience isn't fooled so easily.

With respect to your argument about apartments: I agree with you when you say that month-to-month lease is more expensive because the income isn't guaranteed. However, I think your reasoning is flawed. If I rent you an apartment, then by default, I cannot rent it to someone else. If I allow you to use my cell network, that does not preclude me from allowing someone else to use my network. I realize that my analogy breaks down somewhat when talking about the physical devices (whether cell phone or car) but it's much easier to have another phone or car delivered to the store/showroom than it is to add additional capacity to an apartment complex.
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Old Jul 22, 2013, 05:49 PM   #43
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Originally Posted by jdechko View Post
Since the rates of AT&T and Verizon are the same no matter which method you choose (traditional vs outright purchase). It's logical to conclude that customers are being double charged for the pleasure. I suspect that we may see some changes to these plans in a year or so after the carriers realize that the target audience isn't fooled so easily.
In AT&T's defense (and I don't defend the carriers very often, if ever) they do have a prepaid plan where for $60/mo you get unlimited calls and text and 2GB of data.

I think the cheapest post-paid plan on AT&T is $65/mo for 450 minutes and 250MB of data. You may actually have to buy a separate texting plan with that.

----------

Quote:
Originally Posted by rdlink View Post
Rent-a-Center comes to the phone business. Pay waaaay too much for something just because you want it now. Slime buckets.


Sadly, I think you've hit the nail right on the head with your statement above. I'm afraid that the carriers have realized that just about everyone who wants a smartphone, and can afford one, now has one. The only thing left to do is sign up people who want them, but can't afford them. (Ironically, this is what led to the banking crisis here in the U.S.)

I think this might have larger implications for Apple. I believe Apple makes over half their revenue from iPhone sales. It will be hard to Apple to continue to grow once that market is maxed out.
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Old Jul 22, 2013, 06:19 PM   #44
tdar
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Originally Posted by jdechko View Post
Then the carriers have been lying to us all along.

It's really simple math. We've been sold subsidized devices while being told that part of the monthly fee is going to paying off the subsidy.

.
Lying to us would be a Surprise? Please show me where ATT or Verizon says that part of your monthly is to repay subsidy. I don't think they have ever said that...In fact just the opposite.

It may be math but it does not have to be simple math as everyone is assuming. We really do not know how they do this. Anyone who knows is not allowed to tell and those who think they know are guessing. I'm sure of one thing- they do it in the most profitable way possible. I'd bet that there are tax incentives at play for about 36% of it. I also do not think they account for it on a account by account basis, but rather as a total cost to the company as a business development cost. But again, now I'm one of those who are guessing.

I should confess that I do not believe the proposition that I offered before to be true, just that I wanted to offer another way to see what they might do. The true fact is that we do not know how this works and that is by design. If was as simple as everyone seems to think it is, why would they not just say so? In fact they say that there is not a portion of your monthly fee that is for subsidy. So again are they lying?
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Old Jul 22, 2013, 06:42 PM   #45
jdechko
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Originally Posted by tdar View Post
Lying to us would be a Surprise? Please show me where ATT or Verizon says that part of your monthly is to repay subsidy. I don't think they have ever said that...In fact just the opposite.

It may be math but it does not have to be simple math as everyone is assuming. We really do not know how they do this. Anyone who knows is not allowed to tell and those who think they know are guessing. I'm sure of one thing- they do it in the most profitable way possible. I'd bet that there are tax incentives at play for about 36% of it. I also do not think they account for it on a account by account basis, but rather as a total cost to company as a business development cost.

I should confess that I do not believe the proposition that I offered to be true, just that I wanted to offer another way to see what they might do. The true fact is that we do not know how this works and that is by design. If was as simple as everyone seems to think it is why, would they not just say so? In fact they say that there is not a portion of your monthly fee that is for subsidy. So again are they lying?

Carriers lying to us would not be a surprise. Nor would it be a surprise for them to overly-complicate things in order to confuse the customer. It's called fine print and it's been going on for quite some time. I agree that as a business, their goal is to maximize profits.

If you aren't paying for the device outright (like in the new system or on T-Mobile), the money has to come from somewhere else. Whether they tell you that it does or doesn't come from your monthly fees is immaterial.
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Old Jul 22, 2013, 07:48 PM   #46
alent1234
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Everyone knows the impulse challenged people want it NOW and will pay for it

So you charge them as much as you can

Nothing evil



Quote:
Originally Posted by jdechko View Post
Then the carriers have been lying to us all along.

It's really simple math. We've been sold subsidized devices while being told that part of the monthly fee is going to paying off the subsidy.

Exhibit A
If a non-contract iPhone cost $650 and you only pay $200 in the store for it, where is the extra $450 coming from?

Answer: It's pretty obvious that they're not writing it off. So it must come from your monthly fee.

Exhibit B
Early Termination Fees: If you break your contract early, you have to pay to "cancel your contract"

Answer: It costs the carriers very little to remove you from their system. But that's not the reason for the ETF. Since we already know the carrier isn't going to write off the remaining amount of the phone, the logical answer is that the ETF covers any remaining portion of the device itself. Standard ETF on a smartphone is $350 (The difference between the cost and ETF can be explained by volume discounts. A discount of $100 per phone when you are buying millions seems reasonable). Fortunately, the carriers also reduce the ETF for each month you've paid into the contract (and paid off your phone). By around the 20th month, you've completely paid off the phone and no longer have an ETF.

Exhibit C
T-Mobile: T-Mo actually separates the cost of the device from the cost of the service. The new service plans have been reduced in cost compared to the old model where the subsidy is included in the monthly fee.

Since the rates of AT&T and Verizon are the same no matter which method you choose (traditional vs outright purchase). It's logical to conclude that customers are being double charged for the pleasure. I suspect that we may see some changes to these plans in a year or so after the carriers realize that the target audience isn't fooled so easily.

With respect to your argument about apartments: I agree with you when you say that month-to-month lease is more expensive because the income isn't guaranteed. However, I think your reasoning is flawed. If I rent you an apartment, then by default, I cannot rent it to someone else. If I allow you to use my cell network, that does not preclude me from allowing someone else to use my network. I realize that my analogy breaks down somewhat when talking about the physical devices (whether cell phone or car) but it's much easier to have another phone or car delivered to the store/showroom than it is to add additional capacity to an apartment complex.
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Old Jul 22, 2013, 08:18 PM   #47
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nah, t-mobile is the way to go, those guys have the best offers.
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Old Jul 23, 2013, 03:51 PM   #48
tdar
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nah, t-mobile is the way to go, those guys have the best offers.
Maybe where you live but not where I do. A phone that does not work is not worth any amount of savings.
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Old Sep 16, 2013, 05:44 PM   #49
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Iphone 5s/5c support more bands

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Rent-a-Center comes to the phone business. Pay waaaay too much for something just because you want it now. Slime buckets.

I have a Share Everything plan with Verizon, and I'm thinking about leaving them with this announcement, even though it doesn't affect me. I hate the idea of supporting a company that would do something this slimy.

I wish Apple would just sell a completely unlocked phone that worked on all of the major US carriers, so that people like me could just pick and choose which carrier they want, and make them stumble over themselves trying to offer the best deal.
The new iPhones will support more bands, like the iphone 5, but depending on what model you purchase may be locked to a carrier. My Verizon subsidized iphone 5 was unlocked and worked with AT&T sim so I'm hoping the Verizon model will come unlocked to jump ship but may require contract which is the catch.
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