You're right Kevin. Realized I really should have separated service from iPhone (with exception of that monthly fee they tack on now). I finally did the math where I could find a flaw in the Next pricing. This assumes selling iPhone at end of 2 years for $250 (which I've done with every other upgrade to date) but obviously not doing that with the Next plans. Now I need to decide if the iPhone 6 is actually worth $450...
Correct me if I'm wrong on the math.
Here's how I see your scenario, assuming under 10GB data and 1 iPhone 6 64GB at either:
- $299 + $40 upgrade
- $37.50/month for Next 12
- $31.25/month Next 18
Data costs are the constant....doesn't matter what you choose for a plan, data is the same for both.
Next 12 pricing over a 2 year contract (data not included assuming under 10GB data plan):
$0 down (except taxes for the phone)
$37.50 * 20 months = $750
$25.00 line fee * 24 months = $600
Total after 24 months = $1,350
Next 18 pricing over a 2 year contract (data not included assuming under 10GB data plan):
$0 down (except taxes for the phone)
$31.25 * 24 months = $750
$25.00 line fee * 24 months = $600
Total after 24 months = $1,350
Next 12 or 18 over a 2 year period will equal the same total paid. The only difference comes in
when you can upgrade and either pay off the phone or trade it in.
2 year contract pricing (data not included assuming under 10GB data plan):
$299 one time fee for the phone
$40 one time upgrade fee
$40.00 line fee * 24 months = $960
Total after 24 months = $1,299
So you save just a little on a 2yr contract....not much, but a little.
If you were to instead have a 10GB+ data plan, then things change a little more in favor of Next:
Next 12 pricing over a 2 year contract (data not included assuming 10GB+ data plan):
$0 down (except taxes for the phone)
$37.50 * 20 months = $750
$15.00 line fee * 24 months = $360
Total after 24 months = $1,110
Next 18 pricing over a 2 year contract (data not included assuming 10GB+ data plan):
$0 down (except taxes for the phone)
$31.25 * 24 months = $750
$15.00 line fee * 24 months = $360
Total after 24 months = $1,110
Next 12 or 18 over a 2 year period will equal the same total paid. The only difference comes in
when you can upgrade and either pay off the phone or trade it in.
2 year contract pricing (data not included assuming 10GB+ data plan):
$299 one time fee for the phone
$40 one time upgrade fee
$40.00 line fee * 24 months = $960
Total after 24 months = $1,299
You can see where Next really starts to benefit when you go 10GB of more on data, since the 2yr contract doesn't change no matter what your data.
And people need to remember, with Next you own the phone after either the 20/24 months of payments (or if you prepay early).
If you for example went with Next 12, and each year traded in your phone right after 12 months....AT&T over the course of 2 years is technically making more money because you end up paying 24 months worth of payment on 2 phones. I think most people say if you are going get a new phone after 12 months, you are probably better off paying off the balance, and selling the phone yourself.
-Kevin
