Sprint Stops Offering Two-Year Phone Contracts

[AustinIllini]

A premium phone that bends. That is premium alright.

Ferraris break when you don't use them correctly. Ferraris are certainly premium.

You bend your phone, that's user error.

 

[MaxinMusicCity]

I agree. The new way is easier to understand. But that's where I think some people are going to be weary of spending 649+ on a phone. They'll think "it used to only be 199!" Even though you and I know and understand differently. But I guess it won't have a whole lot of affect on Apple, they'll still sell more than enough at whatever price.

Yes, I have a friend that just wouldn't believe she was paying more than $199 for her phones. Then she switchted to Straight talk thinking all would be cheaper...and she got the shock of her life! The phones she was accustomed to really were expensive!

 

[nj1266]

Ferraris break when you don't use them correctly. Ferraris are certainly premium.

You bend your phone, that's user error.

Riiiiiiiight!!! Blame the user. I bet you did not blame the user when the iPhone 6 had bending problems.

 

[AustinIllini]

Riiiiiiiight!!! Blame the user. I bet you did not blame the user when the iPhone 6 had bending problems.

I absolutely did. There are very few premium products in any market that are completely rugged as well.

Sitting on or bending your phone is equivalent to
"My transmission broke because I didn't change gears"
"I ruined my Burberry coat because I rolled around in the mud"
"I hit my Rolex with a hammer and now it's broken"

Seriously, stop with the bending nonsense. Try to understand the difference between "premium" and "rugged". Unless you're exclusively buying from Patagonia, the North Face, or other RUGGED premium brands, the word "premium" refers to the quality of the hardware, software, and user experience when used properly.

 

[mdlooker]

I'm interested in what this means for future iPhone pricing. Now that everyone will see the unsubsidized price. It will no longer be masked at 199/299 type price points. I've learned that there's a surprising number of people who don't understand that those 199/299 prices aren't the full price of the phone.

I wonder how my monthly charge is going to change now since I've been on contract since 2005 and received subsidized pricing? Where will the deduction come from?

There are a surprising number of people that believe monthly costs will decrease or change at all for that manner for me.
[doublepost=1452289125][/doublepost]

The old way was paying $199 down and the rest of your phone payment was hidden inside your monthly bill. You're right... nobody knew what the hell was going on.

But the new way is showing you exactly how much of your bill is for the phone... and how much is for service. It's separate. When you talk to the salesman... they have a worksheet where they tally up the various parts of your plan (the base voice/sms plan, the phone, the data package, etc)

And if you do pay full price for a phone... or someone gives you an old phone... you're not paying for the phone every month. Only for the service.

It actually easier to understand now.

This is the part that kills me... why is this so hard for people to understand??

My monthly bill will remain the same, whether I purchase with a subsidized price or I buy the phone outright from Apple. The difference between the two is I paid that subsidized price + taxes to stay on contract to the network for two years vs. getting a new phone at full retail, not on contract, with the same monthly cost. I just lost ~$500 or so every two years. AT&T, however, just gained a ~$500 profit per contract customer; HUGE for AT&T!

My monthly cost will only increase if I decide to go with the monthly installments. Now they just "snuck" full retail into my monthly cost. <------- this is the only plan price change I will ever incur.

 

[Michael Scrip]

This is the part that kills me... why is this so hard for people to understand??

My monthly bill will remain the same, whether I purchase with a subsidized price or I buy the phone outright from Apple. The difference between the two is I paid that subsidized price + taxes to stay on contract to the network for two years vs. getting a new phone at full retail, not on contract, with the same monthly cost. I just lost ~$500 or so every two years. AT&T, however, just gained a ~$500 profit per contract customer; HUGE for AT&T!

My monthly cost will only increase if I decide to go with the monthly installments. Now they just "snuck" full retail into my monthly cost. <------- this is the only plan price change I will ever incur.

All the major carrier are now advertising payment plans instead of contracts.

People hated contracts.

If it costs the same... then what's the problem?
[doublepost=1452292872][/doublepost]

The end result might be the same regarding cost but both methods would affect people's decision differently.

old method of phone plans that include phones cost
1) mask the true cost of the phones. many people not even aware that iphone cost $650.
2) force people to upgrade phone very two years, whether they like to or not. this creates a lot of waste.
3) people are stuck with carriers for 2 years due to plan contract

New method of removing phone cost from plan:
1) people now can see a separate cost item on their bill and are aware of phone cost
2) for many people, they would save money with cheaper plan and keep their old phone longer.
3) no more contract, you can buy iphone from apple with their loan, and free move to any carrier of your choice.

Big difference!

This affects me personally. I would not upgrade to new iphone very two years as I did for the last 5 years. and if I buy a new iphone, I would either pay it off or buy from apple using their loan. then I can move to any carriers at anytime to get better plan deals.

All the major carrier are now pushing payment plans versus the old subsidized contracts. I thought people hated contracts.

There is obviously change in the air.
[doublepost=1452293006][/doublepost]

Yes they are. From the Apple Store website today. http://i.imgur.com/1R2FXCv.png

I was talking about the price tag next to the phone at Verizon, for instance.

It's been a few months since I bought my iPhone 6S Plus in-store... but I remember seeing the monthly price breakdown.

The full retail price might have been listed too... but Verizon is now pushing the monthly payment plans.

 

[mdlooker]

All the major carrier are now advertising payment plans instead of contracts.

People hated contracts.

If it costs the same... then what's the problem?

Well, for me, there isn't much of a problem as I'll just pay the full price. It's just a little amusing to see posters say that there are "hidden" costs and contract customers paying subsidized prices are really paying the full price for the phone.

 

[Michael Scrip]

Well, for me, there isn't much of a problem as I'll just pay the full price. It's just a little amusing to see posters say that there are "hidden" costs and contract customers paying subsidized prices are really paying the full price for the phone.

You and I both know that the other $450 is being paid over the two years.

But the carrier never comes out and says it. So yes... it is "hidden" inside their bills.

Now with the payment plans... you see how much your phone costs per month... and how much the service costs per month.

Or people can follow your lead and pay full price. It all ends up being around the same price... you just take a different road to get there.

 

[scaramoosh]

I just don't see why you'd get rid of contract plans like this, I think it just ends up in less sales :\ I'm happy with my current contract here in the UK, it ends up only being slightly more than if I bought the phone and paid for a monthly sim over 2 years. It allows me to split the cost over time, I'd never pay £600 for a phone upfront, if I had to I'd only spend £200.

 

[deany]

anyone in the know, will this start in the UK? the 2 year contract seems to be the one mainly offered by our carrier EE in the UK
(owner Deutsche Telekom,T-Mobile, Germany)

Cheers

 

[iGeek2014]

anyone in the know, will this start in the UK? the 2 year contract seems to be the one mainly offered by our carrier EE in the UK
(owner Deutsche Telekom,T-Mobile, Germany)

Cheers

I guess, in a way, Tesco Mobile, o2 and Virgin Mobile offer it with their "Refresh/Frestyle" tariffs i.e you pay off the cost of the handset to upgrade early/terminate the agreement.

In a way I'm glad they do this because (even with £0 upfront fee) the cost of the device is factored into the line rental (except those mentioned in this post as they split it between the handset cost/line rental as two separate "loans").

I (personally) think once you are out of your Minimum Agreement your line rental should be reduced to a comparable SIMO tariff if you don't upgrade.

I remember a time when a 12 month contract was the 'norm'!

 

[JackieInCo]

One more carrier about to expose the true premium prices that Apple charges. No more concealing the truth.

Any Apple user knows what the premium price of an iPhone truly is. I bought a sim free 128GB 6S+ from Apple last month. Of course I knew what the price was when I ordered it. I'll do it again each and every year.

 

[x-evil-x]

I'm assuming you paid $199 for your iPhone 3G. Then after 2 years... you sold that iPhone 3G to pay for the iPhone 4.

But guess what... that iPhone 3G didn't cost $199... it really cost $649.

You were actually making additional monthly payments for your 3G all along... you just didn't realize it. The carrier hid those payment insides your bill.

Not much is changing now... except you don't have to make a down payment anymore. You just start making a monthly payment for the phone. You still get to keep it at the end of 24 months. And you can sell it if you want.

But your bill clearly says you're paying $27 a month for the phone... and whatever else for the service.

After 2 years when it's time to get a new iPhone... you sell the old iPhone for cash... and start making the $27 a month payment on the next iPhone.

From Sprint's website, for instance:

Here's the difference:

Old way: $199 down. Hidden payments for the other $450. After 24 months... sell your old phone and use that profit to pay for the next $199 down payment.

New way: $0 down. $27 a month for the phone. After 24 months... sell your old phone. Start new $27 payments for the new phone. But you get to keep the profit from selling the old phone

i understand what you're saying but i pay 80$ a month with no fee for a phone because of the subsidy. i haven't paid for a phone in 6 years or so because of this. I don't care about the 2 year contract because i never broke it so why would it change anything? what are the hidden payments on my 80$ grandfathered bill that you are talking about?

 

[Michael Scrip]

with no fee for a phone because of the subsidy.

You might need to clarify that.

If you receive a subsidy... you're actually paying some fee per month for the phone over the two years. But they don't come out and say how much you're paying.

With these new payment plans... you know right up front that the phone costs $27 a month or whatever.

 

[x-evil-x]

You might need to clarify that.

If you receive a subsidy... you're actually paying for the phone over the two years. But they don't come out and say how much you're paying.

With these new payment plans... you know right up front that the phone costs $27 or whatever.

i mean no fee as in monthly payments like on the next plan. the amount i sell the old phone for covers my subsidy and my monthly contact stays at 80$'s a month.
Not sure what will happen when my 2 year is up in September. i don't want my bill going up 40$? a month because i want a 7+ 128 gig phone
no way I'm paying 900$ for a phone outright to keep my 80$ Bill. So I'm kinda forced into monthly payments now.

 

[Michael Scrip]

i mean no fee as in monthly payments like on the next plan. the amount i sell the old phone for covers my subsidy and my monthly contact stays at 80$'s a month.
Not sure what will happen when my 2 year is up in September. i don't want my bill going up 40$? a month because i want a 7+ 128 gig phone

128GB 7+ would be around $40 a month for the phone on a payment plan.

But the subsidy isn't built-into the phone bill anymore... so that part of your bill should go down.

You want a $949 phone. You have 3 options:

1. Pay $949 plus your monthly service bill
2. Pay $499 on-contract and the rest is built-into your monthly service bill
3. Pay $0 down and $40 a month for the phone... and then pay your monthly service bill

All they're doing is separating the cost of the phone and the cost of the service. It shouldn't be that much different.

Unless, of course, you go for a very expensive phone. You're gonna pay for it somehow.

 

[x-evil-x]

128GB 7+ would be around $40 a month for the phone on a payment plan.

But the subsidy isn't built-into the phone bill anymore... so that part of your bill should go down.

You want a $949 phone. You have 3 options:

1. Pay $949 plus your monthly service bill
2. Pay $499 on-contract and the rest is built-into your monthly service bill
3. Pay $0 down and $40 a month for the phone... and then pay your monthly service bill

All they're doing is separating the cost of the phone and the cost of the service.

It shouldn't be that much different.

i just don't like the fact ill be paying 120 a month for the phone and bill now instead of having it at 80 from the smaller subsidy i never actually felt since 2008.
Don't think there is any hidden fees with a contract bill. 80$ for one line on att grandfathered with unlimited text is pretty cheap.
Now if they offer a pay 300 down to have 20 $ payments on that phone and being able to upgrade every year i wouldn't mind that.

 

[Michael Scrip]

i just don't like the fact ill be paying 120 a month for the phone and bill now instead of having it at 80 from the smaller subsidy i never actually felt since 2008.
Don't think there is any hidden fees with a contract bill. 80$ for one line on att grandfathered with unlimited text is pretty cheap.
Now if they offer a pay 300 down to have 20 $ payments on that phone and being able to upgrade every year i wouldn't mind that.

You might get your wish. AT&T Next... $285 up front... $23.75 a month. Then whatever service plan you want. (though I'm not sure how grandfathered plans work with this)

I said this in another comment but I'm too lazy to look for it. So I'll type it here again:

Old way: $199/299/399/499 down... then the other $450 is included in your monthly service bill over 24 months. They call it a "subsidy" but you're actually paying for it each month.

New way: $0 down... $27-40 a month for the phone... then whatever your service bill will be.

Just to clarify... when I say "hidden fees" I'm talking about when people think they bought an iPhone for $199.

FALSE! They paid $199 at the time of purpose... but they're actually paying the other $450 over 2 years included with their service fees. There is some portion of your bill for the phone. Again... "subsidy" doesn't really describe it because you're paying for it yourself.

But with these new payment plans... you know exactly what the phone costs per month... and what the service costs per month. Add them together and that's what you pay each month.

Your current $80 a month bill is pretty cheap. But do you know how much of that is for the phone and how much of it is for the service? If you figure that out... then you'll be able to see how these new plans stack up.

You want an expensive phone though... so that money has to come from somewhere.

 

[x-evil-x]

You might get your wish. AT&T Next... $285 up front... $23.75 a month. Then whatever service plan you want. (though I'm not sure how grandfathered plans work with this)

I said this in another comment but I'm too lazy to look for it. So I'll type it here again:

Old way: $199/299/399/499 down... then the other $450 is included in your monthly service bill over 24 months. They call it a "subsidy" but you're actually paying for it each month.

New way: $0 down... $27-40 a month for the phone... then whatever your service bill will be.

Just to clarify... when I say "hidden fees" I'm talking about when people think they bought an iPhone for $199.

FALSE! They paid $199 at the time of purpose... but they're actually paying the other $450 over 2 years included with their service fees. There is some portion of your bill for the phone. Again... "subsidy" doesn't really describe it because you're paying for it yourself.

But with these new payment plans... you know exactly what the phone costs per month... and what the service costs per month. Add them together and that's what you pay each month.

Your current $80 a month bill is pretty cheap. But do you know how much of that is for the phone and how much of it is for the service? If you figure that out... then you'll be able to see how these new plans stack up.

You want an expensive phone though... so that money has to come from somewhere.

i need to figure out if att wants you to pay off the phone after 1 year to have it be yours or return it for an upgrade. rather keep it and sell it 1 year later and pay off what i owe left and start the 285 up again. would work if i could sell it for 5-600 a year later.

 

[garylapointe]

Good summation. Basically, the only people benefitting now are those who don't buy new devices. If you have a four year old phone, that's essentially two years of gravy relative to everyone else. The carriers are betting (correctly) on everyone becoming accustomed to upgrading their phone every 1 or 2 years.

Except (as a 2-year upgrader) I'm not finding deals (plans plus upgrade options) that are as good as a deal as my 2-year contracts. So it'll end up costing me more...

Where my additional savings will probably come into the picture is now I'll be able to tether (WiFi Sharing with other devices). That means when I purchase an iPad I'll save $129 on purchasing the non-cellular version (I'll tether it to my iPhone) the same goes for my Kindles (I own two and keep them on 3G so my books are more consistent at syncing their current page from when I don't have WiFi access, it sounds silly but it's a huge convenience) where I'll save about $70 a Kindle when I upgrade next (more often that I broke it than I need a new model).

Although the 200MB a month of free data that T-Mo gives me for my cellular iPad (which I upgrade every 3 years or so) might make it worth it to pay the $129 (plus if I happen to be not getting AT&T data signal very well but I am getting good T-Mo reception, it's like diversifying your data).

Gary

 

[gngan]

How complicated can this be? Why is this thread 7 pages long? People keep saying they pay USD 199 for an iPhone and USD XX or XXX monthly. iPhone has always cost USD 649. The contract you are in (be it 2 years, 3 years, whatever)… part of the cost goes into financing your iPhone. If you buy your iPhone from Apple for USD 649 then your data/line/text may only use USD X rather than XX/XXX.

***The difference is financing or paying full upfront.***

In fact, you can still finance your iPhone but not via carriers. For example, you can borrow money from bank and pay them back monthly. So you guys think that American can get an iPhone for USD 199 while other part of the world has to pay USD 649 for it? Seriously? Apple and carriers are not NGO and they are here to make money. Do you think carriers pay Apple the difference (USD 450=649-199) just so people will use them?

 

[NovemberWhiskey]

A premium phone that bends. That is premium alright.

You are aware that was something like less than 1% of the total base of iphone users, right? Probably 0.00X%

There have been hundreds of millions of iphones sold that have not bent in the slightest, myself included. I had a launch date 6 Plus that had zero bending with after a year of ownership.

You are also aware that tests showed that other phones would bend similarly if put under similar stresses. Some fared better than others, but eventually most of them bent. The ones that fared better were usually of plastic composition, rather than metal. So it wasn't that they did not bend, just that they rebounded to original form after bending.

I can bend my macbook, my tv, my car panels, car exhaust, etc. if i tried hard enough.

It's just not a real issue with the phone. People who bent their phones got a replacement device.

As for the whole Ferrari analogy, Ferraris were notoriously horrible in terms of reliability up through the 1990s. They are better now, but by no means reliable or economical when it comes to maintenance. They would constantly break down, and mainenance (10,000 mile, 20k mile) services required huge overhauls (removing the engine) that would cost thousands and tens of thousands of dollars.

Lots of luxury cars are notorious for being unreliable and/or having lots of maintenance problems. MB, BMW, Audi, etc. Our MB is constantly having electrical gremlins, and most people on the message boards experience the same.