Remember when iPhones cost $199.00?

[iMas70]

Those were the days... $199.00 for a 16GB iPhone with a 2 year contract. Now we're paying over $1K. I'm looking at $1229 with tax. This is pretty much the limit for what I will spend on a phone. A few friends said I'm crazy. I could buy a few non-Apple computers for that money. I don't expect to upgrade for at least 3 years.

 

[Chupa Chupa]

Ah, the good old days.

 

[stretch80]

Those were the days... then every year I would sell the previous model on EBay to pay for the new phone and pocket some extra cash.

 

[MEJHarrison]

iPhones have never cost $200. The remainder of the cost was worked into your monthly bill.

 

[Allyance]

iPhones cost AT&T, Verizon etc over $600 initially, your cost was cover by contracts. All vendors pay the same.

 

[iMas70]

True. I guess I should have said when we used to pay $199.00. My bill never really changed. I don't know if its because I've always had a grandfathered UDP. It's been years so I don't remember the details now.

 

[Aibocyrus]

Trust when we say, you’ve always paid full price for the phones you bought. It’s called subsidized pricing for a reason. Why do you think the contracts were for 2 years? It’s because it took the carriers that long to make back the $400 they didn’t take up front from you.

 

[MagicBoy]

You're comparing prices of a different type. The $199 was network subsidised which they clawed back via a higher monthly contract cost.

 

[myscrnnm]

True. I guess I should have said when we used to pay $199.00. My bill never really changed. I don't know if its because I've always had a grandfathered UDP. It's been years so I don't remember the details now.

The claim that the remainder is factored into your bill is BS, at least when I was on AT&T. There was no difference between my monthly charges with or without a contract. What you're giving up by paying only $199 for a new phone is being locked to their network for two years.

 

[Aibocyrus]

The claim that the remainder is factored into your bill is BS, at least when I was on AT&T. There was no difference between my monthly charges with or without a contract. What you're giving up by paying only $199 for a new phone is being locked to their network for two years.

Bills were structured differently for subsidized phones. Of course you wouldn’t see a change in your bill. See how bills are structured now that phones aren’t discounted down anymore? It’s all based on how the company is going to make their money back. It’s quite foolish to think differently.

 

[myscrnnm]

Bills were structured differently for subsidized phones. Of course you wouldn’t see a change in your bill. See how bills are structured now that phones aren’t discounted down anymore? It’s all based on how the company is going to make their money back. It’s quite foolish to think differently.

Not just on my bill, but comparing my bill to advertised prices. This was back when AT&T charged $40 for voice, $30 for unlimited data, and $20 for unlimited texting. I had that price both when I was on a contract, when my contract ended, as well as being the advertised price for both plans under contract and those without a contract. It's foolish to ignore empirical evidence.

 

[Avenger]

Bills were structured differently for subsidized phones. Of course you wouldn’t see a change in your bill. See how bills are structured now that phones aren’t discounted down anymore? It’s all based on how the company is going to make their money back. It’s quite foolish to think differently.

All I know is that we seemed to get ripped off by the companies taking away subsidies. Sure you are not in a contract but my bill didn't go down one cent.

 

[Aibocyrus]

Not just on my bill, but comparing my bill to advertised prices. This was back when AT&T charged $40 for voice, $30 for unlimited data, and $20 for unlimited texting. I had that price both when I was on a contract, when my contract ended, as well as being the advertised price for both plans under contract and those without a contract. It's foolish to ignore empirical evidence.

Coming from someone who worked for AT&T and knew how it worked, the information I’m giving is educated on the subject.

 

[jmann]

The previous posters are correct. The device access fee for those under contract with a subsidized device would be like $35/month and it would drop to $10 or $15 after contract was finished.

 

[mazdamiata210]

iPhones have never cost $200. The remainder of the cost was worked into your monthly bill.

Except on contract, off contract, when contracts were over... my bill never changed. Still paid the same price. Which was a good price in my opinion. Now everyone I know with shared data and payment plans on phones has a bill that is 2-3 times higher than what they were paying when things were on 2 year contracts.

So no I don't believe that "it was already factored into your bill" because my bill with 5 lines all with unlimited grandfathered plans used to be about 350 per month. Now with shared unlimited the same number of lines cost me about 500 per month. The only benefit being we can upgrade on a yearly cycle. Not worth the $150 premium price tag.

I believe this is the result of really good marketing as well as ignorance of the consumer. Would you rather walk into a store and be told you have to pay 199.99/299.99 or pay $0.00 and get a new phone?
[doublepost=1509141823][/doublepost]

The previous posters are correct. The device access fee for those under contract with a subsidized device would be like $35/month and it would drop to $10 or $15 after contract was finished.

Not before shared data plans. At least not ATT

 

[myscrnnm]

The previous posters are correct. The device access fee for those under contract with a subsidized device would be like $35/month and it would drop to $10 or $15 after contract was finished.

When was the "access fee" implemented? Because I would go through my AT&T bills and there was never such a charge, and my monthly bills remained the same after my contracts had ended. I was on AT&T 2009-2016.

 

[MEJHarrison]

Except on contract, off contract, when contracts were over... my bill never changed. Still paid the same price. Which was a good price in my opinion.

Hey, if you want to think AT&T gave you a $600 phone for $200, go right on thinking that. Heck, it might even be true. Perhaps they simply ate the other ~$400 out of the kindness of their hearts or some other reason we're in the dark about. But if it was true, that is most definitely not how it should have worked and it's not how it worked for most people. I can't say you didn't slip through the cracks somehow. But your experience is not how it worked back then in general.

 

[MagicBoy]

Except on contract, off contract, when contracts were over... my bill never changed. Still paid the same price.

Yeah, like the provider were going to voluntarily drop the bill! That's on you for not contacting them to explore options...

The iPhone was never $200, the true end user cost that we pay for a sim-free one nowadays was hidden behind the murk of exclusive network providers. If you wanted one you have to buy from AT&T or O2 etc with the contract.

 

[kybldmstr]

iPhones never cost $200. It was $200 plus 2 year contract. On ATT that meant an additional $25/month for 24 months. Which mean you’re $650 full price iPhone was actually $800. People can’t do math.

 

[Oridus]

Oh, this is the thread I was waiting for. This should be interesting to follow.

 

[mazdamiata210]

iPhones never cost $200. It was $200 plus 2 year contract. On ATT that meant an additional $25/month for 24 months. Which mean you’re $650 full price iPhone was actually $800. People can’t do math.

Again, my bill never increased +25 every time I added a new device to it. Started with 2 basic flip phones back in 2003/2004 era

Pretty sure the plan was as follows:
700 anytime minutes with rollover $59.99 (First line was included)
2nd line $9.99
Unlimited family messaging $29.99

As the years went on and lines were added the only prices added to the bill were:
3rd line $9.99
Unlimited iPhone data plan $29.99

4th line $9.99
Unlimited iPhone data plan $29.99

5th line $9.99
Unlimited iPhone data plan $29.99

6th line $9.99
Unlimited iPhone data plan $29.99

Total $260 without my ATT discount.

 

[fs454]

The claim that the remainder is factored into your bill is BS, at least when I was on AT&T. There was no difference between my monthly charges with or without a contract. What you're giving up by paying only $199 for a new phone is being locked to their network for two years.

It's not BS. The calculation is that by mandating you to stay with them for 2 years, the profits generated on what they charge for services hit a point where it both covered the remaining device cost and hit whatever margin they have in mind.

Without the contract subsidized device, you pay the same because the idea was to incentivize you with a reduced price smartphone so you'd guarantee them two uninterrupted years of revenue from your account. The model has since changed.

 

[15danielp]

Again, my bill never increased +25 every time I added a new device to it. Started with 2 basic flip phones back in 2003/2004 era

Pretty sure the plan was as follows:
700 anytime minutes with rollover $59.99 (First line was included)
2nd line $9.99
Unlimited family messaging $29.99

As the years went on and lines were added the only prices added to the bill were:
3rd line $9.99
Unlimited iPhone data plan $29.99

4th line $9.99
Unlimited iPhone data plan $29.99

5th line $9.99
Unlimited iPhone data plan $29.99

6th line $9.99
Unlimited iPhone data plan $29.99

Total $260 without my ATT discount.

You're clearly mis-remembering.

 

[myscrnnm]

It's not BS. The calculation is that by mandating you to stay with them for 2 years, the profits generated on what they charge for services hit a point where it both covered the remaining device cost and hit whatever margin they have in mind.

Without the contract subsidized device, you pay the same because the idea was to incentivize you with a reduced price smartphone so you'd guarantee them two uninterrupted years of revenue from your account. The model has since changed.

Okay, but the second part of your comment is basically what I was saying. The tradeoff was your ability to switch carriers at any time. Yes, the cost of the phone is "factored in" in the sense that AT&T has obviously done the calculations in such a way that they are making a profit (they are a business after all, it's not like anyone has forgotten that), but people on contracts were not paying any more on a month-to-month basis than their counterparts who had purchased their phones outright.

 

[0007776]

Except on contract, off contract, when contracts were over... my bill never changed. Still paid the same price. Which was a good price in my opinion. Now everyone I know with shared data and payment plans on phones has a bill that is 2-3 times higher than what they were paying when things were on 2 year contracts.

So no I don't believe that "it was already factored into your bill" because my bill with 5 lines all with unlimited grandfathered plans used to be about 350 per month. Now with shared unlimited the same number of lines cost me about 500 per month. The only benefit being we can upgrade on a yearly cycle. Not worth the $150 premium price tag.

It was built in, and you paid it with or without a phone. A few years back though they decided to raise prices but no one wanted to be the first carrier to do that so they instead got rid of subsidies and charged you extra monthly payments for the phone.