What's up with this subsidized cell phone "low price war" /and cheap people?

[EvryDayImShufln]

Sup

I feel like ranting about this so hear me out. It all started when I visited my buddy working in a store that sold cell phones. There were 3 choices: 1 which was absolute crap for 0$, one which was actually quite sick for about 40$, and one in between, all on a 3 year contract. He told me most customers go for the free one. But this makes no sense in my mind: the plans are (let's say) 35$/month on the low end with tax. So over 3 years you are paying 1260$ for just the contract. Adding another 40$ to that to get a half decent phone is adding an extra 3% to the total price. Now 3% definitely isn't much.

It's like with the iPhone, too. Sure, the iPhone price is 200$, and some other competitors might be 150$ instead. But when you're paying 75$ per month for 3 years, you're shelling out 2700$ during that time period. A 50$ difference between an iPhone and a competitor, let's say, is less than 2% of a difference, and can make all the difference between getting a pile of crap phone instead of a good one.

What do you all think?

 

[PoitNarf]

The average consumer is stupid and only considers the upfront costs of things. They don't factor in the whole cost for the duration of their contract.

Also, usually the people that buy the completely subsidized phones only really care that the phone makes and receives calls and have little or no need for additional features.

 

[Michael CM1]

$40 is $40.

Yes, if you space that out over, I dunno, 40 years, it's only an extra $1 per year. But it's not over 40 years. It's how much you're charged at the register, which is $40 (or $200 for an iPhone or whatever else).

If you save $40 on a phone, that might pay a month of your cable/satellite bill. Actually, it'll probably almost pay for a month of the contract on standard phones.

I can also tell you that there isn't much difference between the free POS phones and the $40 POS phones. I used 3 Motorola phones before my iPhone, and I kept going cheaper on each one because all I needed at the time was bluetooth and a camera. I haven't seen one company that makes a "decent" phone at any price point between the stuff you can find for free (I had two Razrs) and the iPhone $200ish smart phones.

If you want a POS phone, just wait until Best Buy or wherever runs a deal for the phone you want free. It eventually happens if you're patient enough.

 

[Michael CM1]

The average consumer is stupid and only considers the upfront costs of things. They don't factor in the whole cost for the duration of their contract.

Also, usually the people that buy the completely subsidized phones only really care that the phone makes and receives calls and have little or no need for additional features.

I think you summed up my post with the second paragraph. That's how my parents are. They just want a phone that's loud enough, easy enough to use (mainly finding contacts), and has decent battery life. My dad never uses the media player on the newer Sony phone I picked out for him when his last phone pretty much died.

 

[Mr. Giver '94]

The average consumer is stupid and only considers the upfront costs of things. They don't factor in the whole cost for the duration of their contract.

Also, usually the people that buy the completely subsidized phones only really care that the phone makes and receives calls and have little or no need for additional features.

Nailed it on the head. That about sums it up. You did forget to mention that the average consumer is also lazy and needs to get home to have a Twinkie so they aren't willing to shop and compare phones or anything else because they 'don't have the time.' It makes me want to whack these people when I see them but sadly it's just the way it is and we have to realize that average people are ___________. (insert vulgar word here)

 

[Volka]

Even though it cost a lot more, I bought my iPhone 3g on pay as you go. Although the initial cost was a lot higher, I'll be saving a lot of money in the long term.

I don't use my phone enough to justify the free minutes that a contract gives me, and after my 12months free data trial it will only cost £10 a month for unlimited data & wifi hotspot usage