Carrier I think everyone is confused with AT&T Next

[nickprete11]

A lot of people have been pushing off AT&T Next as an instant ripoff, but never look further into it. Things have been said on the forum such as "you can't pay it off" or "you can't sell the phone and pay it off" which is completely un-true. Every AT&T rep I've spoken to said I can pay off the phone at anytime.
Here is an example:

You buy a 16GB iPhone 5s on AT&T Next, it's $0 down, sales tax due upfront.
There are 20 monthly payments of $27, totaling $540, which is $110 less than full retail price. After 12 months, you are eligible to trade in the phone for a new device. The payments on the old device are waived and you select a new device. Or, AT ANY TIME, you can sell the device or pay off the remaining balance. Let's use this as an example; you bought the iPhone 5s on AT&T Next and have made 12 payments of $27. That totals to $324. You're eligible to trade in the device and choose a new one, OR (like at any time) pay off the rest of the device and be eligible for a new two year subsidy or AT&T Next program. You can sell the device after it is a year old for let's say (give or take) $450. You still owe AT&T $216 for the device. You sell the device, make $450, pay off the remaining balance, and come out ahead $234, which you could put towards a 2 year contract or another AT&T Next plan. How is this "such a rip-off"?

 

[1981d]

Well, under a 2 year contract, you would pay $199. After 12 months, you can sell the phone ( using your example) for $450. Then you have spent $199 and have $450 to put towards a new phone, vs spending $324 and only having $234 to put towards an new one. In other words, the contract option allows you to spend less to get the phone while retaining more of its value for future use. At least that's how I see it.

 

[0000757]

Well, under a 2 year contract, you would pay $199. After 12 months, you can sell the phone ( using your example) for $450. Then you have spent $199 and have $450 to put towards a new phone, vs spending $324 and only having $234 to put towards an new one.

Under 2 year contracts, you can't upgrade for another two years (24 months), not 1 year (12 months). You'd still end up paying more, because now your phone is 2 years old and will sell for less.

 

[1981d]

Under 2 year contracts, you can't upgrade for another two years (24 months), not 1 year (12 months). You'd still end up paying more, because now your phone is 2 years old and will sell for less.

Well, you can upgrade at 12 months. They call it early upgrade, and currently the phone costs $450 instead of $199. Using the example above, you would get the new phone for free (if you sold the old one for $450). Under the next plan, you only have $234 left over to put towards your payments on the upgrade. So, under the contract option, you pay $199 initially and use the residual value of the phone to get a free upgrade at 12 months. Under the next plan, you only get $234 to defray the $540 cost of the upgrade, leaving you paying $306 to ATT for nothing.

 

[0000757]

Well, you can upgrade at 12 months. They call it early upgrade, and currently the phone costs $450 instead of $199. Using the example above, you would get the new phone for free (if you sold the old one for $450). Under the next plan, you only have $234 left over to put towards your payments on the upgrade. So, under the contract option, you pay $199 initially and use the residual value of he phone to get a free upgrade at 12 months. Under the next plan, you only get $234 to defray the $540 cost of the upgrade, leaving you paying $306 to ATT for nothing.

Which carriers offer early upgrades? From what I understand, all the major carriers no longer offer early upgrading (in order to push people to their contractless plans).

 

[PPFee]

A lot of people have been pushing off AT&T Next as an instant ripoff, but never look further into it. Things have been said on the forum such as "you can't pay it off" or "you can't sell the phone and pay it off" which is completely un-true. Every AT&T rep I've spoken to said I can pay off the phone at anytime.
Here is an example:

You buy a 16GB iPhone 5s on AT&T Next, it's $0 down, sales tax due upfront.
There are 20 monthly payments of $27, totaling $540, which is $110 less than full retail price. After 12 months, you are eligible to trade in the phone for a new device. The payments on the old device are waived and you select a new device. Or, AT ANY TIME, you can sell the device or pay off the remaining balance. Let's use this as an example; you bought the iPhone 5s on AT&T Next and have made 12 payments of $27. That totals to $324. You're eligible to trade in the device and choose a new one, OR (like at any time) pay off the rest of the device and be eligible for a new two year subsidy or AT&T Next program. You can sell the device after it is a year old for let's say (give or take) $450. You still owe AT&T $216 for the device. You sell the device, make $450, pay off the remaining balance, and come out ahead $234, which you could put towards a 2 year contract or another AT&T Next plan. How is this "such a rip-off"?

With all due respect you just don't understand, you just dont get it!!! No offense intended.
Here is the deal, by using ATT NEXT you are paying for the phone twice! You likely say how because it doesn't reflect that in your math. Thats where the kicker comes in and where we kind of have failed as consumers to be knowledgable and are finally getting tired of it. The prices we pay for our monthly service to AT&T and Verizon are and have always been, according to them and everyone else so its non disputed, the cost of service + the cost of recouping the money initially lost by offering the phones at a subsidized price. In other words they charge everyone the monthly prices they do by factoring in the cost of the handsets across the board. The screwy part comes in where they don't do this on a individual level, when i have paid whatever amount or when my 2 year period is up they don't drop the service prices to a "Service Only/No subsidy" model, instead they continue charging me what they charge the other guy that they are recouping money for a hardware sale from.
The key to remember is they have priced service so that by no later than the 2 year mark they have recouped the entire price of the iphone at full cost, so then after 2 years of service you have paid full price for your iphone before ATT NEXT ever existed. They then come out with NEXT to compete with Tmobiles "similar" but honest plan that doesnt attempt to triple screw us and They want to do us a favor by letting us pay twice each month and twice each 2 year period for our phone?!?! Its laughable and disgusting at the same time. I really hope tmobile alone can inspire more honest practices, but we also need people to be more informed if we are to have hope at this. This is why people in other countries are always saying how ridiculous everything about our wireless services are, they aren't exaggerating sadly. Sorry for getting so philosophical LOL caught the post mid Irish coffee.

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Which carriers offer early upgrades? From what I understand, all the major carriers no longer offer early upgrading (in order to push people to their contractless plans).

They still offer early upgrades at AT&T but even that misses out on the core issue. But the device for a 16gb iphone early upgrade through at&t is another $250 i believe added to the new customer price so that would put it near 450

 

[1981d]

Which carriers offer early upgrades? From what I understand, all the major carriers no longer offer early upgrading (in order to push people to their contractless plans).

ATT does for sure, I've done it twice, as recently as 9/20. Now, what they did do away with was letting you have a full upgrade at 18 mos. Now they make you wait the full 24 to get the full upgrade. I assume that Verizon et. al. Offer the same "early upgrades" as ATT at 12 mos ( meaning a reduced subsidy), but I haven't been with them long enough to know. ( I switched from ATT around the beginning of October)

 

[nickprete11]

No, after paying off the phone, you do NOT have to use NEXT again, you can do a fully subsidized upgrade, which is $199.

 

[macred]

A lot of people have been pushing off AT&T Next as an instant ripoff, but never look further into it.

I agree there are a few reasons people fail to understand the program.

1) They maintain a negative attitude and believe the misinformation.
2) They want to join the "I hate AT&T club"
3) They do not understand convenience has its price.
4) They're only willing to pay premium prices to Apple.
5) They can't understand how cellular carriers operate.
6) They expect others to share their values.
7) They cannot understand the math.

I'm neither promoting or detracting from AT&T. It's a choice and choices benefit everyone.

It's only money

 

[cnotes2019]

I agree there are a few reasons people fail to understand the program.

1) They maintain a negative attitude and believe the misinformation.
2) They want to join the "I hate AT&T club"
3) They do not understand convenience has its price.
4) They're only willing to pay premium prices to Apple.
5) They can't understand how cellular carriers operate.
6) They expect others to share their values.
7) They cannot understand the math.

I'm neither promoting or detracting from AT&T. It's a choice and choices benefit everyone.

It's only money

Blah@its only money


Sent from my iPhone using Tapatalk 2

 

[1981d]

No, after paying off the phone, you do NOT have to use NEXT again, you can do a fully subsidized upgrade, which is $199.

If you did that, here's what you'd have:
Next= $324 spent in payments + $216 to pay off next phone + $199 for new contract phone -$450 for selling your next phone =$289 out of pocket to upgrade at 12 mos.

Contract= $199 to start, + $450 to upgrade at 12 mos, -$450 for selling your orig. contract phone = $199 out of pocket to upgrade at 12 mos.

So, you would still pay ATT $90 for nothing, and you still end up on the contract you were trying to avoid in the first place. I'm still not seeing any advantage to the next plan.

 

[PPFee]

I agree there are a few reasons people fail to understand the program.

1) They maintain a negative attitude and believe the misinformation.
2) They want to join the "I hate AT&T club"
3) They do not understand convenience has its price.
4) They're only willing to pay premium prices to Apple.
5) They can't understand how cellular carriers operate.
6) They expect others to share their values.
7) They cannot understand the math.

I'm neither promoting or detracting from AT&T. It's a choice and choices benefit everyone.

It's only money

Is this serious? How do cellular carriers operate then? Why not shed some light on it if you have some information that will help, please do the same with the point you are trying to make behind the statement "they cannot understand the math". I agree completely that people have a tendency to become Fans or "haters" ( i detest using that word but hear it seems near appropriate) of companies instead of just making informed decisions and letting the best service or product for you win. Loyalty to companies makes no sense to me, you should be loyal to your needs/desires and your wallet, its their job to win you over. I also am all for choices, i do not agree however that any of this is about choice as far as AT&T is concerned, they refuse to give us the choice to simply have our bill reduced once we have paid off the amount of the subsidy or even make public those amounts. If their speed or coverage is worth the price for an individual or company then by all means, that is great, I do understand as i maintain my service with them currently myself.....being under their employ has me with many lines under them actually, but that doesn't mean people should just blindly accept their practices. I think i hear where you are coming from and while i tend to agree i dont at all agree that that is the case here.

 

[fieldsphotos]

ATT does for sure, I've done it twice, as recently as 9/20. Now, what they did do away with was letting you have a full upgrade at 18 mos. Now they make you wait the full 24 to get the full upgrade. I assume that Verizon et. al. Offer the same "early upgrades" as ATT at 12 mos ( meaning a reduced subsidy), but I haven't been with them long enough to know. ( I switched from ATT around the beginning of October)

Verizon does not offer early upgrade pricing. You have to meet the contract length before you are offered any subsidy again. They used to allow you to buy phones at a "one year" contract price that was equivalent to ATTs early upgrade price, but they haven't offered that for several years now. It is too bad, I miss ATTs early upgrade option when I was on them.

 

[PPFee]

Verizon does not offer early upgrade pricing. You have to meet the contract length before you are offered any subsidy again. They used to allow you to buy phones at a "one year" contract price that was equivalent to ATTs early upgrade price, but they haven't offered that for several years now. It is too bad, I miss ATTs early upgrade option when I was on them.

certainly is a shame although thats the least of the things on the list of grievances i have. The truly early upgrade where they offered select customers a full upgrade if you had multiple lines, at varying degrees of earliness for the same price as new customers was nice too. I used that every year for many years.

 

[macred]

Is this serious? How do cellular carriers operate then? Why not shed some light on it if you have some information that will help, please do the same with the paboutoint you are trying to make behind the statement "they cannot understand the math". I agree completely that people have a tendency to become Fans or "haters" ( i detest using that word but hear it seems near appropriate) of companies instead of just making informed decisions and letting the best service or product for you win. Loyalty to companies makes no sense to me, you should be loyal to your needs/desires and your wallet, its their job to win you over. I also am all for choices, i do not agree however that any of this is about choice as far as AT&T is concerned, they refuse to give us the choice to simply have our bill reduced once we have paid off the amount of the subsidy or even make public those amounts. If their speed or coverage is worth the price for an individual or company then by all means, that is great, I do understand as i maintain my service with them currently myself.....being under their employ has me with many lines under them actually, but that doesn't mean people should just blindly accept their practices. I think i hear where you are coming from and while i tend to agree i dont at all agree that that is the case here.

It's not about agreeing, nor do I care if I'm right. I'm simply sharing my perspective both as a consumer and someone who understands and takes finance seriously. As to your specific questions, the answers are all outlined in each carriers terms of service. A very long document that I choose to read before I agree to any contract.

If more consumers would take personal responsibility to read the TOS, Privacy disclosures, and related boilerplate, the dynamics of our free market system would likely be less dismissive of the individual consumers.

My flippant comment - it's only money was just for fun.

 

[PPFee]

It's not about agreeing, nor do I care if I'm right. I'm simply sharing my perspective both as a consumer and someone who understands and takes finance seriously. As to your specific questions, the answers are all outlined in each carriers terms of service. A very long document that I choose to read before I agree to any contract.

If more consumers would take personal responsibility to read the TOS, Privacy disclosures, and related boilerplate, the dynamics of our free market system would likely be less dismissive of the individual consumers.

My flippant comment - it's only money was just for fun.

Respectfully i feel like you are kind of sidestepping or just... i wont speculate further but i get the impression you are "speaking sideways"/mincing words. I am sorry you commented in a forum and on a topic that you have no intention or interest in discussing further or in supporting/expanding on your point. You say its not about agreeing, ok fine, you started your first post off with the words "I agree" for what its worth.

I get the feeling you are trying to walk away from the discussion so i wont push the issue my questions were not questions as to the details of the TOS which i think you know, they were posited to you directly because you seemed to indicate you felt the NEXT program was "on the up and up" and that any issues people have are because of a number of their own various misconceptions etc. and so i asked you to elaborate or shed light on from what you draw your conclusion because it certainly isn't the simple facts of the matter or the TOS. Far from the witch hunt you seem to believe this is made out to be, it in fact has been analyzed and scrutinized by all levels and types of people and you cannot with facts or terms represent it as anything else, that was MY point. It was not at all about trying to make a person, neither I nor you, to be correct or incorrect but simply the merits of the program itself. I agree (even if thats not "what this is about") again with the uninformed consumer angle but even if many are against this program for reasons that aren't of an informed nature, there are many who are the very definition of informed and know this to be anything but "good for consumers". Choices are not choices when they are wrapped up in falsehoods, misrepresented, and sold in a way any decent informed person would perceive as being charged twice for a single item or service. Its completely understandable for the OP for instance who just simply didn't know, as most consumers dont, that we are already paying for the phone once over the life of the contract regardless of any subsidy but I do not see what possible reason there would be for you to come and say you are informed and Know the Terms of Service from cover to cover etc. and still try to suggest consumers are being anything BUT informed in their rejection of this entire program.

Again its not a matter of opinions or perceptions, at&T AND Verizon AND Sprint continue shady business practices that should never have been acceptable but were allowed to prosper in the monopoly type of environment in which they came up and thrived and sadly countries across the world that are behind us in every type of way can not even grasp how we get so screwed in the States!

Here is the Verge on the Topic, they came to the same conclusion with the two following quotes highlighting their analysis: "There simply isn't a scenario in which paying for Next is better than just buying an unlocked phone at retail" and "AT&T'S REACTION TO T-MOBILE'S TRANSPARENCY IS TO BE MORE DECEPTIVE THAN EVER"
http://www.theverge.com/2013/7/16/4528404/att-next-phone-upgrade-plans-a-huge-ripoff

 

[Apple Trees]

You're paying for the phone twice. You don't get a subsidy but you're still paying the same rate plan price of someone who got a subsidy. If you like giving away money long term in order to not pay as much upfront then go for it. It's a waste. Good for AT&T, poor value for the consumer.

Now if they offered something like a $10-15 discount on the monthly rate plan for people who used Next then it would be a good idea.

This is one area where I'll give T-Mobile credit. They actually offer lower rate plans in return for financing your phone while AT&T is charging you the same price for the plan and still having you pay for the phone too. T-Mobile's network just sucks.

 

[FiveZeroFour]

Well put and much simpler and more to the point than I was able to for sure lol! I actually keep a tmobile SIM card and a $3/day plan that gives you x minutes and 500 MB of data and I use that to contine to test their LTE and network in general, it's a Great cheap way to get access without committing. I switched two family members already, the coverage isn't satisfactory for me ATM yet but I have seen ridiculous strides made improvement wise in last 6 months so much so that I now am sure it's just a matter of time before I add a line with them even if I keep my AT&T plan as well.

 

[nestafaria]

How is this "such a rip-off"?

Do you work for AT&T? It's not hard to understand how it's a ripoff, and its been explained to death all over the internet.

 

[aneftp]

The best way to answer AT&T next is to ask the sales rep if they have any of their friends or family members (outside of those who get att employee benefits).

Ask ATT sales rep if they have signed up any of their family member or friends with AT&T next program.

I bet you will hear a lot of silence which the question. Silence is a tell tale sign if sales rep cannot even sign their friends or family members up.

 

[TroyBoy30]

until they lower your monthly service plan prices, you are paying them twice. the phone subsidy is still part of your monthly plan

 

[joeshmo2010]

AT&T NEXT is essentially like leasing a car. Buying vs leasing are there for two different kinds of people. Buying is for the person that wants their money to go toward the investment of an asset in hopes that it can be traded in and hold a good residual value. Leasing is for the person that does not want a long high payment and does not mind always having a monthly payment as long as it is lower that the buying and they get a new vehicle every three or so years.

That is what AT&T next is. You get a low monthly payment for basically the amount of time you have AT&T as you get a new phone every year. The only downside is that when it comes to getting that new car, or getting that new phone, there is no asset that was held from all of the payments. But that's what that option is for, for people that don't mind the low monthly payment as long as they get the new thing quickly.

 

[Small White Car]

You buy a 16GB iPhone 5s on AT&T Next, it's $0 down, sales tax due upfront.
There are 20 monthly payments of $27, totaling $540, which is $110 less than full retail price. After 12 months, you are eligible to trade in the phone for a new device. The payments on the old device are waived and you select a new device. Or, AT ANY TIME, you can sell the device or pay off the remaining balance. Let's use this as an example; you bought the iPhone 5s on AT&T Next and have made 12 payments of $27. That totals to $324. You're eligible to trade in the device and choose a new one, OR (like at any time) pay off the rest of the device and be eligible for a new two year subsidy or AT&T Next program. You can sell the device after it is a year old for let's say (give or take) $450. You still owe AT&T $216 for the device. You sell the device, make $450, pay off the remaining balance, and come out ahead $234, which you could put towards a 2 year contract or another AT&T Next plan. How is this "such a rip-off"?

Bad plan. I have a plan that earns me $8 per year. Your plan costs you $90 per year.

Saving $8 is better than spending $90



My Math vs. Your Math:

You and I, each getting a new iPhone each year. You using AT&T Next and me using a regular 2-year contract.
(All math done for 2 years and then I divide it in half at the end to represent 1 year.)




AT&T - 2 Year Plan

Pay $199 for upgrade price on one year
Pay $649 for off-contract phone on the other year
Recoup ($900) for selling my phone each year
One $36 re-activation fee

= -$16 / 2
I am earning $8 per year off of this



Your AT&T Next Plan over 2 years:

$648 worth of monthly fees
$432 to pay off your phone early twice
Recoup ($900) for selling your phone each year

= $180 / 2
You are spending $90 extra per year

 

[jdag]

It is pretty simple to me...These new plans are for those that simply do not want, or do not have the means, to pay for a phone upfront, regardless of the cost.

It is the same reason why some people will purchase on a payment plan from a rent-to-own company. Like my brother-in-law's crazy girlfriend that once bought a PlayStation for "only $25/month" she enthusiastically proclaimed. Until I showed her that the $300 PlayStation was going to cost her $650. DUH!!! (She really is that naive.)

Further, Many many many people do not know that there is an aftermarket for used phones, and the prospect of eventually selling does not come into play. Many people just want to walk out of a store with as little out of pocket as possible. Period.

So are these newfangled plans "ripoffs"? Completely depends on your finacial requirements. $0 out-the-door completely overshadows the total cost of ownership for many people.

 

[macsrcool1234]

Bad plan. I have a plan that earns me $8 per year. Your plan costs you $90 per year.

Saving $8 is better than spending $90



My Math vs. Your Math:

You and I, each getting a new iPhone each year. You using AT&T Next and me using a regular 2-year contract.
(All math done for 2 years and then I divide it in half at the end to represent 1 year.)




AT&T - 2 Year Plan

Pay $199 for upgrade price on one year
Pay $649 for off-contract phone on the other year
Recoup ($900) for selling my phone each year
One $36 re-activation fee

= -$16 / 2
I am earning $8 per year off of this



Your AT&T Next Plan over 2 years:

$648 worth of monthly fees
$432 to pay off your phone early twice
Recoup ($900) for selling your phone each year

= $180 / 2
You are spending $90 extra per year

/thread.

On a side note about AT&T upgrades..I get a full upgrade every 12 months somehow. I have been able to buy every new iPhone fully subsidized on launch day (including the 5S).