Sure, the service is a large part of that, meaning that the cost of the phone itself isn't over $2000.
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To what extent do you think lack of 2 year subsidy will impact US iPhone sales?
- Thread starter thadoggfather
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I can see them offering a 36 or 48 month plan to attract low income buyers. I also predict the end of 16gb base and a 32 or 64 gb starting point so consumers will think they are getting their money's worth
As a college student still on my mom's phone bill this year, I will not be able to afford a new iPhone if it costs me $749.
My monthly bill averages $90 / month with the added fees and taxes, which comes to $2160 over two years. I'm on the hook for that, unless I want to pay a stiff ETF. Call it what you want, but I am essentially buying something that costs $2160. So that means last year's model at $100 discount would have still ended up costing $2060, and the "free" 2 year old iPhone would've costed $1960.
What sucks is that up until now, the phones were being subsidized at $18.75 / month, and for those of us that want to keep our unlimited data plans, we will still be paying the same price for our plans with no subsidy.
I agree, that sucks, but the carriers change things and don't support the old stuff and realistically could just get rid of it.
That said, yes, there's the contract, and all that, but you aren't paying that money for just the phone, you are paying it for the service you are getting and using, with some part of it being there to pay off the phone. Thus the phone itself doesn't cost over $2000, the service itself costs a good part of that.
For iPhone, it doesn't matter much as Apple now has the iPhone upgrade plan where you can get new iPhone every year. So this reversed the traditional wireless market completely, where now Apple completely sell, finance, and support the hardware, and people then just shop for carriers that they want.
Just buy them outright and upgrade as soon as you can afford. I paid 1k for the 6 plus and skipped on the 6s because i was not ready to drop coin on a phone. Now with the 7 being completely redesign ill sell mine to recoup some of the costs and paid for the 7 upfront.
I always used to buy my handsets outright, but once O2 introduced their refresh tariffs (similar to the Next from what I can gather), it was a no-brainer to move to it:
It doesn't cost any more and O2 take the hit on an interest free 2 year loan for me. On top of that, I can sell my phone after a year and pay off the outstanding balance and get a new phone every year. If I choose to keep a phone over 2 years, the payments stop and I'm paying a lower amount every month than on the old subsidised plans
IMO, it's a far better deal for consumers
It doesn't cost any more and O2 take the hit on an interest free 2 year loan for me. On top of that, I can sell my phone after a year and pay off the outstanding balance and get a new phone every year. If I choose to keep a phone over 2 years, the payments stop and I'm paying a lower amount every month than on the old subsidised plans
IMO, it's a far better deal for consumers
Have the US monthly payments been reduced to reflect the removal of the phone subsidy?
Yes, I'm paying 40 dollars a month per line on ATT. If I bring my own phone to the party, I pay 25 on the current data plan I have, If I up that plan to a higher quota, I only pay 15 a month,
That's good to know. I never understood how they got away with charging the same amount when your contract had ended under the old system.
That's not exactly correct.
Then new plans do offer a discount for being out of contract (or more accurately a penalty for taking a subsidy) however that discount is (often) less than the value of the subsidy. In other words AT&T only gave a partial discount and pocketed the rest as profit.
So under the new system if a person never upgrades then it's a better deal. But if someone upgrades on time (i.e. every 2 years) then it's actually a worse deal now.
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Prior to the carriers embracing this new model. I paid 40 dollars a month per line regardless if my phone as out of contract or not. To put it another way, there was no advantage to bringing your own phone to the party. You paid the same regardless.
No at least you can pay between 15 and 25 dollars depending on the data plan and carrier.
My days of buying brand new devices is over. I signed a 2 year deal with AT&T on Dec 21 and I can't see myself paying $800 for a new device (installment plan or upfront). Once my 6s needs to be replaced I will most likely head to swappa and by a newish device.
Well, with installment plans, assuming you are on a newer plan that gives you a discount for being on an installment plan, it's more or less like getting a subsidized phone with a 2-year contract.
It's usually less tho. Which is what I was trying to say.
In my situation I was paying $250 for 5 lines with 2 UDP. To go over to new plan (25GB) it would cost me $207 but then if I added the cost of the new iPhones (and selling old iPhones) It would be 300 net cost. So I would pay 50 extra each month and give up unlimited on 2 lines for capped data.
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On my plan the discounts are $25/month for each line, so the overall cost works out to be less than it was with subsidy.
That's because you are comparing the subsidy on the new plan. I'm talking about the old plans with rated minute and text plans.
I was on one of the original individual iPhone plans (started with unlimited, dropped down to 2GB).
I got together with a friend and some family members also on the old individual iPhone plans and moved to a 10GB MSV (which AT&T doubled to 20GB for free, back when they were matching that thing Sprint did). And now my FAN discount helps everyone else.
We each save about $25/month now, and get double the data. This is on the old plans with the rated minutes.
25/month savings isn't good because 18.75 is the net savings you get for just 1 lines because of the subsidy. In other words you need to take your old cost and subtract 18.75 * each line to see the real aka net cost for service. Since you said you got together with a friend and some family members, I'm guessing you lost more than 1 subsidy.