America's first prepaid iPhone arrives on Cricket Wireless June 22 - Page 2

Yes, it does but doing the baseline analysis is the simplest.

1. I'm using the Apple Store retail price since it's a comparable storefront to carrier stores or Apple selling carrier-subsidized phones. It wouldn't be fair to use the Dodgy Bros. Cellular eBay Store since they don't sell AT&T-subsidized iPhones with two-year contracts.

2. Yes, I am ignoring overage charges. For the purposes of this analysis, we need to assume that people have read the fine print in advance and are using the plans in the way they were intended. If you are constantly going over your voice or data limits, you have clearly picked the wrong plan. In the same way, I wouldn't do a cost analysis of vehicles for a family of six that was constantly renting a minivan because their Mazda Miata was insufficiently sized.

3. Again, people will need to read the fine print and decide if the text plan is suitable. I would never pay for a separate text plan since I use Google Voice and their free SMS capability. I didn't pay for texts when I was using a GoPhone SIM. It worked fine. I can't assume how many texts anyone gets. For that matter, my mom never texts.

4. I believe you. Again, I am operating under the assumption here that the plan is used in the manner in which it is intended.

5. Yes, however my cost of ownership analysis is for a two-year period since those are the typical contract terms for a subsidized handset. Most people don't leave their contract in the middle.

Conversely, Straight Talk and Cricket could increase their monthly rates at any time. With a two-year contract at AT&T, Verizon, and Sprint, those terms and rates are locked until the contract expires.

I purposely avoided including international calling/texting since charges vary by carrier and destination. Anyhow, there are affordable international calling services (like Google Voice) that pretty much level the playing field. Google Voice call charges are the same regardless if you're using an iPhone, iPad, or iPod touch, some other smartphone or even your PC.

But since you brought it up, let's do a cost of ownership analysis over twelve months for Straight Talk and AT&T (similar service levels) with the cancellation charge for the latter.

Straight Talk: $649 factory unlocked iPhone 4S, $15 SIM, $45 per month for twelve months (price includes unlimited talk/text, cellular data 2GB soft cap). Cancellation charge: zero dollars. Total cost of ownership: $1204

AT&T: $199 subsidized iPhone 4S, $36 activation fee, $120 per month for twelve months ($70 unlimited talk, $20 unlimited text, $30 cellular data 3GB). $325 Early Termination Fee minus $10 per month for each month of service = $205. Total cost of ownership: $1880

Total cost of ownership over 12 months (including any cancellation charges):

Straight Talk: $100.33

AT&T: $156.67

Of course, I'm not going to delve into every single possible cost analysis, and I have purposely ignored plans that people have been grandfathered into since there's only applicable to those still on them.

Quote:

Originally Posted by gwmac 

Few people want to buy an unlocked phone up front for $650 and that is only for the 16GB model. Cricket at least is offering a small subsidy. That is also why I took issue with the 24 month comparison. Sprint allows full upgrade credit at 20 months. What is AT&T and Verizon's policy?

 

I certainly plan to upgrade at 20 months on June 1, 2013 and possibly a lot sooner if the 2012 iPhone blows me away. At 1 year I would have to pay more than $199, but if I sold my current 4S which is in pristine condition I probably wouldn't ended up paying more than $350 out of pocket with the 1 year upgrade credit added. 

 

That is the real issue with pre-paid is the high upfront cost and having to keep your phone a lot longer to see any real savings. 20 months is the maximum I want to keep a phone. 

Verizon Wireless is 20 months.

Quote:

Originally Posted by gwmac 

Few people want to buy an unlocked phone up front for $650 and that is only for the 16GB model. Cricket at least is offering a small subsidy. That is also why I took issue with the 24 month comparison. Sprint allows full upgrade credit at 20 months. What is AT&T and Verizon's policy?

 

I certainly plan to upgrade at 20 months on June 1, 2013 and possibly a lot sooner if the 2012 iPhone blows me away. At 1 year I would have to pay more than $199, but if I sold my current 4S which is in pristine condition I probably wouldn't ended up paying more than $350 out of pocket with the 1 year upgrade credit added. 

 

That is the real issue with pre-paid is the high upfront cost and having to keep your phone a lot longer to see any real savings. 20 months is the maximum I want to keep a phone. 

The break even point for Straight Talk is at month 6. The longer you use a device on Straight Talk, the cheaper the total cost of ownership.

But okay, here's quickie 20-month analysis of Straight Talk and AT&T:

Straight Talk: $649 factory-unlocked iPhone 4S, $15 SIM (one-time charge), $45 per month for 20 months. Total cost of ownership: $1564

AT&T: $199 subsidized iPhone 4S, $36 activation fee, $120 per month for 20 months. Total cost of ownership $2635

Let's take this a step further and pretend to upgrade to the next generation device.

Straight Talk: $649 factory-unlocked sixth-generation iPhone, keep using the same SIM (no charge), $45 per month for 20 months. Total cost of ownership: $1549

AT&T: $199 subsidized sixth-generation iPhone, $36 upgrade fee, $120 per month for 20 months. Total cost of ownership: $2635

Total cost of ownership, 40-month timeframe over two generations of handsets:

Straight Talk: $77.83

AT&T: $131.75

Still a 41% discount from Straight Talk in total cost of ownership using 20-month handset buying cycles versus the 44% saved in 24-month buying cycle.

The comparisons in this discussion have been fantastic. I send much appreciation to cvaldes for the great numbers.

I suspect something has been altered in recent negotiations with Apple and also with the various carriers. PagePlus hasn't put it on their website yet and it has only been confirmed by a couple dealers who also frequent Howard Forums, but they are claiming that Page Plus now allows activation of used iPhone 4/4S's from Verizon on their prepaid service and also have changed their "55" plan to unlimited talk/text and 2 gigs of data for $55.00 a month.

I've got an Android phone I'm messing around with on Page Plus right now and if you don't need much data, they really have some amazing offerings in my opinion. I put my Motorola Droid X2 (a promising phone spec-wise but has some audio issues in reality) on their "12" plan which is $12 a month for 250 voice/250 text and 10 megs data. This next month when I am out camping in areas that AT&T fears to go, I will have that same phone (X2) on their $30 "Talk and Text" plan which gives 1200 voice minutes/3000 text messages and 100 megs of data.

Page Plus has had no qualms about allowing Android phones on the lower priced plans since they aren't subsidizing anyone on any phone. Per Howard Forums, they have just now been allowed to activate the iPhone as well. While the data quantities are not large, those prices are quite amazing for having smartphones on Verizon's network. We are talking about the ability to have an iPhone 4/4S working for $12 a month.

Those are good points and interestingly enough, could point at the value of some of these plans in high tax states vs low tax states. I live in California and when I have a post-paid cell plan, I am charged sales tax on it along with several other smaller taxes. I give Straight Talk $45 a month for my phone and that price is the total. On Verizon, I save 15% on the plan, not the additional services added to it like data and the savings basically off-sets the cost of the various taxes. Perhaps there is more savings in other states but for me, the discount is basically a wash since all it does it remove taxes from my equation.

Quote:

Originally Posted by trumptman 

Those are good points and interestingly enough, could point at the value of some of these plans in high tax states vs low tax states. I live in California and when I have a post-paid cell plan, I am charged sales tax on it along with several other smaller taxes. I give Straight Talk $45 a month for my phone and that price is the total. On Verizon, I save 15% on the plan, not the additional services added to it like data and the savings basically off-sets the cost of the various taxes. Perhaps there is more savings in other states but for me, the discount is basically a wash since all it does it remove taxes from my equation.

I'm a California resident as well and oddly enough, $0.94 in additional fees are added on top of Straight Talk's $45 monthly charge. I have set up auto-refill via a credit card.

Clearly, these aren't sales taxes since that would be over three bucks.

I was paying way less when I could still use AT&T GoPhone's PAYG $0.10/minute plan on my iPhone. There were no additional taxes. A $100 service card gave you $100 of GoPhone credit. Even better, at some online stores, you could get a nominal discount, like 10%. Pay $90 and get $100 worth of GoPhone credit; they just e-mail you the activation code. Unfortunately, AT&T wised up and eliminated data packages for the $0.10/min plan. That was a total bargain for people with very few voice calls, minimal/no texts, and modest data. I was spending about $12-13 per month on cellular services. (sigh) Those days are gone.

Quote:

Originally Posted by oberpongo 

No 3GS as cricket is CDMA and 3GS is GSM.
Wonder if the GSM portion of the 4S is unlocked.

Yes at $500 down it is certainly a prepaid phone. 

But CDMA is not the phone transmission technology which is very portable in other countries.

In Canada, England and Europe iPhones are GSM.

Last time I check America is not only the US; in my country, Mexico, we've have the iPhone sold contract-free since the iPhone 3G and around the time the iPhone 4 came out, Apple started selling them on its website too.

Quote:

Originally Posted by SolipsismX 
It's funny that if you call it United States you aren't likely to be informed that other countries have states.

Mr. Mexico up there could have still made his comment. Estados Unidos, and all. 

Quote:

Originally Posted by Volaris 

Cricket does indeed run its own network on 1900MHz and 1700MHz, depending on location. They use Sprint/MetroPCS/and other CDMA networks in locations where they don't have their own network in order to achieve a nationwide network, all without roaming fees. I believe Verizon is the only one not included (unless you pay roaming fees) They're working on their LTE options - I believe they were testing their LTE network in... Arizona? Here in California (where Cricket is based) they've had their own network in the Central Valley and San Diego for about a decade.

Thanks!

Quote:

Originally Posted by JeffDM 
Edit: iPod Touch can use iMessage, that much is advertised by Apple. It can also do FaceTime and Skype over WiFi, as shown on Apple's web page on the product.

And thanks!