Now that Verizon got rid of Contracts..LESS iPhone unit sales this coming 6S?From selling full price

[DBZmusicboy01]

I honestly do not think majority of people will have $650+ right away for a phone.
90 Percent of the public really thinks that iPhone only costs $200 to buy when they sign up for a contract and they think it's an amazing deal but they do not know that the added cost is also in the monthly service.
$200 is easy for anyone really...But $650+ right away is a lot for the majority.
The majority of the people are going to buy the iPhone at the Apple store. So people will need to pay off unlocked prices. Not everyone likes T-Mobile depending on their location and Sprint is terrible...

 

[C DM]

You are forgetting Edge or basically financing. There's no money down at all, which is less than even the usual $200. That could likely be even more appealing as people wouldn't have to pay anything at all aside from perhaps taxes or something like that, compared to paying $200 or so.

That said, this is all for essentially new customers or those who switch to the new/current plans. Those on existing plans still have the same upgrade options that were previously available to them.

 

[CTHarrryH]

All are going that route - obviously it will all depend upon how it is explained to customers. I'm sure most people will go with the paying it off over 24 months etc. Like most other things - people care about the bottom line. If a new phone is going to cost you $x a month vs. what you paid before I'm sure it will work out fine for the vendors. The real drivers in the new plans is the data portion and are you able to get what you need without buying too much.
I'm sure 6 months from now people won't know what all the pieces are - just what they pay a month

 

[ftaok]

I have believed that going unsubsidized will actually help apple in the USA. Here's my logic on it.

At subsidized prices, high end phones are $200. Mid level phones are $100 and the lo end phones are free. So now that the full price of the phone is unhidden, the price tiers are around $400, $500, $600.

Under a subsidized plan, the price doubles between a mid end phone to a high end. That drives a lot of folks to mid end ( and low end) phones.

With unsubsidized plans, the price jump is still the same $100, but the consumer may think the jump from $500 to $600 is worth it for a much better phone. Plus with 0% financing, you can walk out of the store with a high end phone and not have to pay anything other than tax.

I wouldn't be surprised if Verizon sees sales of their mid tier phones evaporate and the high and low end dominates.

 

[CEmajr]

One only needs to look at T-Mobile. They've had no subsidies for two years now and sell tons of iPhones. It's their best selling phone all the time. Most don't pay $650 upfront to get their phones. Now instead of $199, you only need come out of pocket with sales tax to get the latest iPhone. Make no mistake, this helps Apple even more. $0 sounds a lot better than $199. It's also easier to upgrade every year because people can just make payments for 12 months, trade in their phone and keep getting the latest iPhone for $0 down again.

No one cares about the long term cost. They've been paying it anyway all this time, it was just hidden in the rate plan. People just care about how much it costs right now to get the latest iPhone in their hands.

 

[willmtaylor]

No. If anything, it will drive sales b/c instead of paying $200/$300 upfront for the phone, Verizon will just spin it as adding the cost of the phone divided by 24 months onto the monthly bill. It essentially makes the phone $0 down. It'll now essentially be "rent to own."

 

[C DM]

No. If anything, it will drive sales b/c instead of paying $200/$300 upfront for the phone, Verizon will just spin it as adding the cost of the phone divided by 24 months onto the monthly bill. It essentially makes the phone $0 down. It'll now essentially be "rent to own."

Well, you own it, you are just financing the payments.

 

[willmtaylor]

Well, you own it, you are just financing the payments.

Well...yes and no. One could argue semantics here, as one doesn't technically own the phone until it's paid off (one cannot sell the phone, change carriers, etc., until it's paid off). Point taken though.

 

[C DM]

Well...yes and no. One could argue semantics here, as one doesn't technically own the phone until it's paid off (one cannot sell the phone, change carriers, etc., until it's paid off).

Pretty sure you can sell the phone or give it to someone else and just continue with the payments as usual. It's your property you just have a loan associated with it that you have to be making payments on. Similar to a house being your own property despite you having a mortgage on it.

 

[willmtaylor]

Pretty sure you can sell the phone or give it to someone else and just continue with the payments as usual. It's your property you just have a loan associated with it that you have to be making payments on. Similar to a house being your own property despite you having a mortgage on it.

Again, 1/2 a dozen of one, 6 of another.

 

[Avi360]

Yup, we've been conditioned by the U.S. carriers to think that an iPhone is $200. But, as many of the previous posters correctly pointed out, the service provider is actually recouping the cost (and more if you don't upgrade when it's time) of the phone while disguising it in the monthly line fees.

I'm glad U.S. carriers are finally getting on board with this new phone-payment setup. It's black and white now- here's what you pay for your service, and here is what you pay for your phone. All clearly labeled on the monthly statement. If you want to lower your monthly bill then pay off your phone(s) and only pay for the service.

There are NO finance charges. You literally end up paying the same price for a phone as if you bought it all at once. The carriers give this to consumers because they want their business...it's a competitive market now.

AT&T offers a phone financing/ monthly installment plan called ''Next'' that does the same thing that T-mobile and Verizon ''Edge'' offers. Pay the full sales tax on the phone when you get the phone, then after all monthly payments are made, the phone installment charge is removed your bill. (unlike with the old 2-year contracts which continues charging the full line fees even when you're out of contract).

 

[willmtaylor]

Yup, we've been conditioned by the U.S. carriers to think that an iPhone is $200. But, as many of the previous posters correctly pointed out, the service provider is actually recouping the cost (and more if you don't upgrade when it's time) of the phone while disguising it in the monthly line fees.

I'm glad U.S. carriers are finally getting on board with this new phone-payment setup. It's black and white now- here's what you pay for your service, and here is what you pay for your phone. All clearly labeled on the monthly statement. If you want to lower your monthly bill then pay off your phone(s) and only pay for the service.

There are NO finance charges. You literally end up paying the same price for a phone as if you bought it all at once. The carriers give this to consumers because they want their business...it's a competitive market now.

AT&T offers a phone financing/ monthly installment plan called ''Next'' that does the same thing that T-mobile and Verizon ''Edge'' offers. Pay the full sales tax on the phone when you get the phone, then after all monthly payments are made, the phone installment charge is removed your bill. (unlike with the old 2-year contracts which continues charging the full line fees even when you're out of contract).

The amount of sales tax paid varies from state to state. Some require full amount of phone be paid at time of pu chase while others do not.

 

[Avi360]

The amount of sales tax paid varies from state to state. Some require full amount of phone be paid at time of pu chase while others do not.

Yes, the sales tax varies from state to state. It's 5.6% where I live, so I'd pay $42.00 to walk out with an iPhone 6, 64GB on AT&T 'Next.' I imagine the other carriers have an incredibly similar setup- but I could be wrong. : )

 

[willmtaylor]

Yes, the sales tax varies from state to state. It's 5.6% where I live, so I'd pay $42.00 to walk out with an iPhone 6, 64GB on AT&T 'Next.' I imagine the other carriers have an incredibly similar setup- but I could be wrong. : )

Actually, sales tax vary by states as well as local municipality, but that wasn't was I was referring to.

Some states require that the tax of the full amount of the phone $600-$900 be paid at time of purchase while other states do not require full amount at that time.

 

[Avi360]

Actually, sales tax vary by states as well as local municipality, but that wasn't was I was referring to.

Some states require that the tax of the full amount of the phone $600-$900 be paid at time of purchase while other states do not require full amount at that time.

My example of paying $42 tax to walk out with the $749.99 phone took 'paying tax on the full phone MSRP' into account.

But, that's interesting! I just happen to live in a state the requires the sales tax be paid on the full MSRP at time of 'purchase.' I guess I thought that was a given in every state. I know otherwise now, thanks for sharing that!

 

[ftaok]

Yes, the sales tax varies from state to state. It's 5.6% where I live, so I'd pay $42.00 to walk out with an iPhone 6, 64GB on AT&T 'Next.' I imagine the other carriers have an incredibly similar setup- but I could be wrong. : )

Not for nothing, but I'm thinking you ought to check your att bill to make sure they aren't charging you tax on the phone portion of you bill.

 

[garya73]

Again, 1/2 a dozen of one, 6 of another.

Not really. With the house, you have an item that can be foreclosed on by the bank and resold to another person. With the iPhone, Verizon or any other carrier is not going to repossess your phone. They don't want the phone, they want your payments/money. Same with financing just about everything else except vehicles/boats/etc or going to somewhere like Aaron's or Rent A Center.

The carriers will probably just hound you for a while, and then send you to some collection agency to collect the amount due. I can't imagine they'd sue in small claims unless it was for multiple phones or right at the beginning of a contract where you still owe a lot on the phone. But they take some of the risk out of that by running your credit. People with bad credit won't get the option to walk out only paying sales tax.

 

[willmtaylor]

Not really. With the house, you have an item that can be foreclosed on by the bank and resold to another person. With the iPhone, Verizon or any other carrier is not going to repossess your phone. They don't want the phone, they want your payments/money. Same with financing just about everything else except vehicles/boats/etc or going to somewhere like Aaron's or Rent A Center.

The carriers will probably just hound you for a while, and then send you to some collection agency to collect the amount due. I can't imagine they'd sue in small claims unless it was for multiple phones or right at the beginning of a contract where you still owe a lot on the phone. But they take some of the risk out of that by running your credit. People with bad credit won't get the option to walk out only paying sales tax.

Yeah, I get that it's technically a different scenario.

However, in my mind, if something isn't paid in full (car note with bank holding the title), rent-to-own-furniture (for those who are bad at math), or even a $850 phone (with full amount being subsidized over a 24-month period), and there are negative repercussions to not paying it off (dispossession, collection of collateral, being reported to a collection agency, or one's credit being negatively affected, said item doesn't belong to me.

But that could just be my perspective on the whole matter. Maybe I'm just old-fashioned in thinking that if I haven't paid for something that it's not really mine yet.

 

[Nelliebee]

Not really. With the house, you have an item that can be foreclosed on by the bank and resold to another person. With the iPhone, Verizon or any other carrier is not going to repossess your phone. They don't want the phone, they want your payments/money. Same with financing just about everything else except vehicles/boats/etc or going to somewhere like Aaron's or Rent A Center.

The carriers will probably just hound you for a while, and then send you to some collection agency to collect the amount due. I can't imagine they'd sue in small claims unless it was for multiple phones or right at the beginning of a contract where you still owe a lot on the phone. But they take some of the risk out of that by running your credit. People with bad credit won't get the option to walk out only paying sales tax.

This isn't entirely true because my sister has probably the worst credit ever, let's just say she can not get any credit card and owes on a car that was repossessed and was taken to court for not paying her rent, and yet verizon STILL let her join that edge program to get an iphone 6. She's also someone who was consistently late on her phone bill payments because she often asked me to help her pay it off whenever verizon shut off her phone service so they would turn it on again. I am just not sure why these phone companies are taking risks like that cause I just can't see irresponsible people like this paying it off or giving the phone back if their service is shut off.