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New subsidized iPhone every year?

1

1981d

macrumors 6502
Original poster
Sep 24, 2013
265
65
Since the resale value of the iPhone after 1 year exceeds the ETF for any of the major carriers, I was wondering if you could theoretically jump carriers every year, sell your old iPhone, and get a new one at the subsidized price, all for less than the edge/next scheme. For instance:

If you buy a new 5s in September 2013 for $200 with VZW, a year later your ETF will be $230. If you port out to ATT In Sept 2014, and sell your 5s for $300, you would have $70 to put towards a new iPhone 6 from ATT. Assuming the price point is the same at $200 for a 2 yr contract, you could get the new iPhone for $130, $165 if you couldn't get the activation fee waved. And going back to VZW in 2015 would have similar results. This assumes that both carriers meet your needs and are the same from an operational and price for service standpoint. So, wouldn't $130-$165 per year be cheaper than the edge/next scheme, or have I missed something here?
 
Newtons Apple said:
"Have you missed something?"

Sounds like a lot of trouble and I would kinda like to keep my phone number for more than a year.
Click to expand...

You can keep the number, just port it over. And it is a bit of a hassle, but maybe worth it if the iPhone is super awesome, vs a marginal upgrade.
 
At some point ATT or VZW will not accept you as a customer if you continually sign up, cancel. There's been a handful of threads where people did just that, signed up,stayed for a while then moved to the other carrier. Then jumped back the next year for the new phone.

FWIW, there's generally not a lot of changes between a "S" version of the iPhone and non "S" version, so I think its a lot of work for not much gain. I'm on the non "S" cycle and so I'm seeing big changes from the 5 and to the 6, where as going from the 5 to the 5s didn't present a lot to entice me.
 
maflynn said:
At some point ATT or VZW will not accept you as a customer if you continually sign up, cancel. There's been a handful of threads where people did just that, signed up,stayed for a while then moved to the other carrier. Then jumped back the next year for the new phone.
Click to expand...

This is what I was thinking. I can't imagine they wouldn't notice this after a couple round trips.

To the OP, just get on ATT next and pay the phone off in 12 months so you can sell it and re-up with the new phone...or go with TMobile. Way less hassle.
 
Sounds like you may be single. My wife would seriously object to the constant change. Always having to hand me her phone so it could be backed up and then restored on a new device. She's not a tech person in the first place so forced change like this once a year is not going to go down very well.

And by the way, my ETF right now on my iPhone 5 is $100 (I'm on Sprint). It's a worn iPhone 5, but everything works and the screen is good. I'm pretty damn sure I could get far more for it than $100 right now, especially since it's the 64GB model. Even if it is a Sprint phone.

P.S. We don't sell our phones anyway, so this little plan is a moot point for us. We tend to keep our phones for two or more years.
 
Isn't using AT&T's early upgrade offer pretty much the same thing but with no hassle?

It's the subsidized price plus $250.
So that makes the base iPhone $450 if prices stay the same. Sell your current one for $250-300 and it's only $150-200 for the new phone.

I just did it last year. Bought a 32GB 5S for $550, sold my previous iPhone 5for $400, cost to upgrade $150.
 
BeeGood said:
This is what I was thinking. I can't imagine they wouldn't notice this after a couple round trips.

To the OP, just get on ATT next and pay the phone off in 12 months so you can sell it and re-up with the new phone...or go with TMobile. Way less hassle.
Click to expand...



if your on ATT Next program via 12 month (20 month to "own" or 18 month option 24 months to "own") - if you drop or cancel service month 13 if you want to wait to upgrade and keep the phone your still on the for 6-7 months of payments for the phone plus the ETF fees up to $350 per line ...

12 month Next - 32.50(16GB *6) $200
18 month Next - 27.50 (16GB*5) $165
12 month Next - 37.50 (32GB *6) $225
18 month Next - 31.50 (32GB*5)$157.50
12 month Next - 42.50 (64GB*6)$255
18 Month Next - 35.42 (64*5)$177.20
 
iPhil said:
if your on ATT Next program via 12 month (20 month to "own" or 18 month option 24 months to "own") - if you drop or cancel service month 13 if you want to wait to upgrade and keep the phone your still on the for 6-7 months of payments for the phone plus the ETF fees up to $350 per line ...

12 month Next - 32.50(16GB *6) $200
18 month Next - 27.50 (16GB*5) $165
12 month Next - 37.50 (32GB *6) $225
18 month Next - 31.50 (32GB*5)$157.50
12 month Next - 42.50 (64GB*6)$255
18 Month Next - 35.42 (64*5)$177.20
Click to expand...

I'm not saying he should cancel his service. I'm saying that if his goal is to "upgrade" every year, he should get on the next plan (24 month option), 12 months later pay the phone off and sell it and get on the next plan again with the next generation phone.

So he will pay (27x12) plus tax which will be approximately $380 over 12 months. But he will be on a cheaper unsubsidized plan, he will recoup some of his payments from the sale of his phone and he won't have to pay $199 plus tax plus $40 upgrade fee, which will come out to about $260.

Long story short, he basically breaks even without jumping through all the hoops of trying to game the carrier's subsidized phone model.
 
My main point in posting this question was to try and understand why people couldn't just switch carriers every year vs signing up for the next/edge programs. So this is mainly an academic discussion. I'm using the example of one phone just for easy argument. Getting my wife to go along, as mentioned above, might not be viable:D

I've switched carriers a few times and it was a smooth, instant process each time I did it, wasn't a hassle at all. But I know others have had different experiences. Also, I'm not sure why the carriers would be too concerned about it, they get a year of business, plus the $200 upfront and the ETF on the back end, so they should be made whole. Here's how I see the math:

Annual switching: price of new phone + activation fee + ETF - 12 month ETF discount - resell value of the phone = cost of upgrading annually. That could be $200 + $35 + $350 - $120 - $300 = $165 to upgrade to the newest iPhone every year. Additional considerations are that you might get the activation fee waived:) and the carriers might ban you for being a jumper:(. But I'm not sure it really hurts them to let you pursue this. Besides, you would be operating within the letter of your contract.

Next/Edge: Sales Tax upfront (8.25% for me) + 60% value of the phone - 12 months of line discounts = cost of upgrading annually. That could be $53+ $389 - $120 = $322. You could payoff the phone and then resell it, but I think you will lose $$ on that proposition.

So, by my calculations, you would pay $130-$165 for a new phone annually by switching, and $322 annually by using the carrier's annual upgrade plans. It seems somewhat viable to me, but like others said I'm not sure if there is a max number of times you could do it before the carriers cry foul.
 
iPhil said:
if your on ATT Next program via 12 month (20 month to "own" or 18 month option 24 months to "own") - if you drop or cancel service month 13 if you want to wait to upgrade and keep the phone your still on the for 6-7 months of payments for the phone plus the ETF fees up to $350 per line ...

12 month Next - 32.50(16GB *6) $200
18 month Next - 27.50 (16GB*5) $165
12 month Next - 37.50 (32GB *6) $225
18 month Next - 31.50 (32GB*5)$157.50
12 month Next - 42.50 (64GB*6)$255
18 Month Next - 35.42 (64*5)$177.20
Click to expand...
There are no early termination fees for the Next program. That's kinda the whole point of it. Instead of calling it ETF, they call it loan repayment. :p


1981d said:
Annual switching: price of new phone + activation fee + ETF - 12 month ETF discount - resell value of the phone = cost of upgrading annually. That could be $200 + $35 + $350 - $120 - $300 = $165 to upgrade to the newest iPhone every year. Additional considerations are that you might get the activation fee waived:) and the carriers might ban you for being a jumper:(. But I'm not sure it really hurts them to let you pursue this. Besides, you would be operating within the letter of your contract.

Next/Edge: Sales Tax upfront (8.25% for me) + 60% value of the phone - 12 months of line discounts = cost of upgrading annually. That could be $53+ $389 - $120 = $322. You could payoff the phone and then resell it, but I think you will lose $$ on that proposition.
Click to expand...
I've always had to pay sales tax upfront so for me, that portion is the same either way.

Subsidized (switching)
Upfront $200
Activation $40
Monthly Device Fee $40 * 12 = $480
Device Amortization $0
Loan Payoff $0
ETF $205-230 (AT&T $205, Verizon $230)
TOTAL $925-$950 ($745-$770 device only, $705-730 with waived activation)
Resale Value ~$450
TCO $475-500 ($295-$320 device only, $255-280 with waived activation)

Next 12 (payoff)
Upfront $0
Activation $0
Monthly Device Fee $15 * 12 = $180
Device Amortization $32.50 * 12 = $390
Loan Payoff $260
ETF $0
TOTAL $830 ($650 device only)
Resale Value ~$450
TCO $380 ($200 device only)

1981d said:
So, wouldn't $130-$165 per year be cheaper than the edge/next scheme, or have I missed something here?
Click to expand...
On MS 10+GB plans, the monthly device fee for smartphones is $15 on Next vs $40 on contract. That's a difference of $25/mo or a total of $300 for 12 months.
 
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