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Retailers discount iPhone 5s down to $120, AT&T offers customers $450 to leave T-Mobile [u]

post #1 of 45
Thread Starter 
Friday brought three impressive new deals for those looking to buy a new iPhone or jump ship from their current carrier, with Best Buy knocking up to 35 percent off of on-contract iPhone 5s sales, MacMall pricing the 5s at $120 and AT&T offering up to $450 per line to customers who switch from rival T-Mobile.

Update: MacMall will also be running a special limited-time-only iPhone promotion for the new year, with the 5s priced at $119.99 and 5c free on contract. More details below.

Best Buy iPhone 5c offer


Best Buy's iPhone 5s sale, which runs through Jan. 4, brings the 16-gigabyte flagship handset down to $124.99 when purchased with a two-year contract. The 32-gigabyte model retails for $224.99 with the promotion, and the 64-gigabyte variant checks in at $324.99.

The retailer is also discounting Apple's mid-range iPhone 5c --?a new two-year deal will net customers one of the plastic-backed handsets for free. Like the iPhone 5s sale, the iPhone 5c promotion is only valid until the close of business tomorrow.

AT&T, meanwhile, has taken its ongoing battle against rival GSM carrier T-Mobile to a new level. Beginning today and continuing for a limited time, Dallas, TX-based AT&T will give switchers up to $450 in service and device credit.

T-Mobile customers who trade in their current smartphone will receive an AT&T gift card worth up to $250 --?AT&T says that each device's trade-in value will be determined separately, but "many of the latest and most popular smartphones" will earn the full $250. Customers who port their T-Mobile number to an AT&T Next plan, purchase a new device at full retail price, or activate an existing device will receive an additional $200 credit for each activated line, though they will need to wait up to 90 days to receive the subsidy.

AppleInsider sponsor MacMall is also running a New Year's sale for Apple's latest handsets. The reseller is offering the iPhone 5s for only $119.99, while the 5c will be available for free, with a two-year Verizon contract. Promotional pricing is good only through this weekend.
post #2 of 45

The cell phone market is like a cocaine supplier.

 

The entire industry only exists due to carrier subsidies. Phone adoption would have been far slower otherwise.

 

And now they want to get rid of subsidies and still think they’ll sell the same amount of content? They think that because we “need” cell phones now as a “society” that we’ll be “forced” to pay for them. 

 

This had better blow up in their faces.

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post #3 of 45

Good!

 

Cell phone companies are a rip-off. (And so are Cable companies!)

 

Soon, I'll buy my iPhone 5s/6 outright and go with T-Mobile. I may get my iPad Air thru T-Mobile as well, even though it's only 200mb of free data. Still, it's a step in the right direction.

 

If/when Tang can accommodate the 5s, I may go with them. 

 

And Verizon, ATT and Sprint can stick it up their nose! :)

post #4 of 45
Are iPhones allowed to be discounted after less than 4 months on the market? /s
post #5 of 45
Originally Posted by wakefinance View Post
Are iPhones allowed to be discounted after less than 4 months on the market? /s

 

Do you see Apple discounting the iPhone?

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post #6 of 45
Quote:
Originally Posted by Tallest Skil View Post
 

 

Do you see Apple discounting the iPhone?

 

No, but that's not what I said.

post #7 of 45
can we please agree to stop calling it "Carrier Subsidy"???

The postpaid Cell Phone market in USA runs on something that can be called Carrier Loans.

You give your SSN
The company that approves the loan checks your credit history
Once convinced that you can repay,
the company will approve your application for a loan of $450 (you are paying $199 downpayment upfront).

That $450, is paid back by the subscribers over two years at a whopping 50% annual interest!!!!! (thats a very conservative estimate of ~$18 per month, where as iPhone/Smartphone plans have always been $30 more than non-smartphone plans).

So, where is the "Subsidy" that everyone keeps referring to?
post #8 of 45
Quote:
Originally Posted by calvinbhai View Post

can we please agree to stop calling it "Carrier Subsidy"???

The postpaid Cell Phone market in USA runs on something that can be called Carrier Loans.

You give your SSN
The company that approves the loan checks your credit history
Once convinced that you can repay,
the company will approve your application for a loan of $450 (you are paying $199 downpayment upfront).

That $450, is paid back by the subscribers over two years at a whopping 50% annual interest!!!!! (thats a very conservative estimate of ~$18 per month, where as iPhone/Smartphone plans have always been $30 more than non-smartphone plans).

So, where is the "Subsidy" that everyone keeps referring to?

 

Carrier subsidy has made sense because until recently you paid the same monthly rate for service whether or not you purchased your phone at the subsidized price.  Now with the option of cheaper monthly rates for those who don't take the "upgrade price", a loan is a more accurate name for the structure.

post #9 of 45
Quote:
Originally Posted by calvinbhai View Post

can we please agree to stop calling it "Carrier Subsidy"???

The postpaid Cell Phone market in USA runs on something that can be called Carrier Loans.

You give your SSN
The company that approves the loan checks your credit history
Once convinced that you can repay,
the company will approve your application for a loan of $450 (you are paying $199 downpayment upfront).

That $450, is paid back by the subscribers over two years at a whopping 50% annual interest!!!!! (thats a very conservative estimate of ~$18 per month, where as iPhone/Smartphone plans have always been $30 more than non-smartphone plans).

So, where is the "Subsidy" that everyone keeps referring to?

The credit check is to see if you can pay the monthly bill. You'd get the same treatment even if you bring your own device.
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post #10 of 45
Zero chance I'm leaving T-Mobile. Good luck AT&Terrible.
post #11 of 45
Quote:
Originally Posted by dasanman69 View Post


The credit check is to see if you can pay the monthly bill. You'd get the same treatment even if you bring your own device.

T Mobile doesn't do a credit check and they seem to be doing just fine. 

post #12 of 45
Quote:
Originally Posted by wakefinance View Post

Are iPhones allowed to be discounted after less than 4 months on the market? /s
Quote:
Originally Posted by wakefinance View Post

No, but that's not what I said.

Really it is what you suggested. The iPhone isn't discounted, the phone + 2 year contract is discounted. You aren't paying for the phone when you pay $199 or $125, you're paying a deposit on the phone plus 2 years of a given service. It's unlikely that Apple has agreed to take $75 less per unit from the carrier and the contract-free price looks to remain the same across the board. This means the only thing that can be determined is the carrier is looking to increase subscriber-ship by earning slightly less, which over 24 months is only a difference of less than $3.13 pre month. This can said for any vendor's device so long as we don't see the vendor dropping prices.

"There is no rule that says the best phones must have the largest screen." ~RoundaboutNow

 

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post #13 of 45
Quote:
Originally Posted by tyler82 View Post

T Mobile doesn't do a credit check and they seem to be doing just fine. 

I believe hey did a credit check on me when I bought my Retina iPad Mini. I have only paid them a little over $20 at this point and have had it for nearly 2 months.

"There is no rule that says the best phones must have the largest screen." ~RoundaboutNow

 

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post #14 of 45
Quote:
Originally Posted by wakefinance View Post

Carrier subsidy has made sense because until recently you paid the same monthly rate for service whether or not you purchased your phone at the subsidized price.  Now with the option of cheaper monthly rates for those who don't take the "upgrade price", a loan is a more accurate name for the structure.

This is why I have been telling people to upgrade their iPhone every two years. If you have to pay anything out of pocket after you sell or trade it in it's likely very little and you get a much better product for the price that also resets the resale value. Of course, if you don't plan on sticking with the carrier for the next two years with this subsidy model it may not make sense but it seems most people stick with their carriers.

I wish I would have since AT&T still doesn't have LTE in my area and I found it quite annoying when I made the unfortunate mistake of entering a store to inquire as to when LTE would arrive in my area only to get canned responses from the brainwashed trained employees who seemed incapable of using the term "LTE" in any form, but instead recite that AT&T has largest and most reliable '4G' network, the whole time looking at you with fake smiles and dead eyes.

"There is no rule that says the best phones must have the largest screen." ~RoundaboutNow

 

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post #15 of 45
Quote:
Originally Posted by SolipsismX View Post



Really it is what you suggested. The iPhone isn't discounted, the phone + 2 year contract is discounted. You aren't paying for the phone when you pay $199 or $125, you're paying a deposit on the phone plus 2 years of a given service. It's unlikely that Apple has agreed to take $75 less per unit from the carrier and the contract-free price looks to remain the same across the board. This means the only thing that can be determined is the carrier is looking to increase subscriber-ship by earning slightly less, which over 24 months is only a difference of less than $3.13 pre month. This can said for any vendor's device so long as we don't see the vendor dropping prices.

 

Best Buy is discounting the phone for consumers.  I think that was fairly clear in the article.  That has nothing to do with Apple's revenue stream in any way at all, and I never implied such.

post #16 of 45
Quote:
Originally Posted by calvinbhai View Post

can we please agree to stop calling it "Carrier Subsidy"???

The postpaid Cell Phone market in USA runs on something that can be called Carrier Loans.

You give your SSN
The company that approves the loan checks your credit history
Once convinced that you can repay,
the company will approve your application for a loan of $450 (you are paying $199 downpayment upfront).

That $450, is paid back by the subscribers over two years at a whopping 50% annual interest!!!!! (thats a very conservative estimate of ~$18 per month, where as iPhone/Smartphone plans have always been $30 more than non-smartphone plans).

So, where is the "Subsidy" that everyone keeps referring to?

Where is this 50% annual interest? You're not talking about the actual service plan are you? If I go to AT&T with an IPhone I own free and clear and sign up for a plan and I also sign up for that same plan with them giving me a phone the cost per month is the same. That's a subsidy. The only difference is I have to sign up for a contract so they can get their pound of flesh for having given me a phone at a highly reduced cost.

"There is no rule that says the best phones must have the largest screen." ~RoundaboutNow

 

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post #17 of 45
Quote:
Originally Posted by tyler82 View Post

T Mobile doesn't do a credit check and they seem to be doing just fine. 

Don't pay late because they cut off the service off much quicker.
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post #18 of 45
Quote:
Originally Posted by wakefinance View Post

Best Buy is discounting the phone for consumers.  I think that was fairly clear in the article.  That has nothing to do with Apple's revenue stream in any way at all, and I never implied such.

To me, your sarcastic comment read differently. To me, it sounded like you were making a comparison to when other vendors have to discount their devices just months after they hit the market which this forum is quick to comment on and valid when it's the vendor making the price cut and there is no evidence that sales are substantial.. For example, the Moto X just dropped to $399 after starting at $580 in 4 months and I'd say that it's because it's not doing well.

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post #19 of 45
Quote:
Originally Posted by SolipsismX View Post


To me, your sarcastic comment read differently. To me, it sounded like you were making a comparison to when other vendors have to discount their devices just months after they hit the market which this forum is quick to comment on and valid when it's the vendor making the price cut and there is no evidence that sales are substantial.. For example, the Moto X just dropped to $399 after starting at $580 in 4 months and I'd say that it's because it's not doing well.

 

I understand your confusion with the Moto X in mind.  In fact I was making reference to the countless threads about discounts on other manufacturers' handsets, but those threads are usually about carrier discounts (i.e. Galaxy S4 dropping to $99 on contract or, God forbid, free).

post #20 of 45
Quote:
Originally Posted by dasanman69 View Post

Don't pay late because they cut off the service off much quicker.

Yes I learned that the hard way, they kill your service at 12:01 am if your bill is not paid current on the day it is due.
post #21 of 45
Quote:
Originally Posted by wakefinance View Post

I understand your confusion with the Moto X in mind.  In fact I was making reference to the countless threads about discounts on other manufacturers' handsets, but those threads are usually about carrier discounts (i.e. Galaxy S4 dropping to $99 on contract or, God forbid, free).

I'd say your comment in that regard is valid.

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post #22 of 45

T-Mobile does indeed do credit checks, which is why their plans are all "O.A.C for well-qualified buyers."

post #23 of 45
Quote:
Originally Posted by wakefinance View Post
 

 

Best Buy is discounting the phone for consumers.  I think that was fairly clear in the article.  That has nothing to do with Apple's revenue stream in any way at all, and I never implied such.

 

Exactly. BBY is just running a short promotion to generate some traffic. BBY is selling at a loss on the hardware, but carriers generally pay $100-150 commission / bounty for signing up a new contract. So BBY uses the sales commission to offset discounts.  When carriers themselves discount phones at their outlets, and keep it, that's generally a bad sign. 

post #24 of 45

Rumor is that T-Mobile will announce next week that AT&T customers who come to T-Mo will get their early termination fee refunded if they trade in their phone.

 

AT&T is just fighting back.

 

If you bring your own phones, for a family of four:

 

T-Mo costs $100 plus tax with 500MB data each (not shared), and AT&T costs $155 plus tax with shared 2GB data on their Mobile Share Value Plan.

 

The way I see it, AT&T will have to lower prices to compete.

post #25 of 45
Quote:
Originally Posted by SolipsismX View Post


Really it is what you suggested. The iPhone isn't discounted, the phone + 2 year contract is discounted. You aren't paying for the phone when you pay $199 or $125, you're paying a deposit on the phone plus 2 years of a given service. It's unlikely that Apple has agreed to take $75 less per unit from the carrier and the contract-free price looks to remain the same across the board. This means the only thing that can be determined is the carrier is looking to increase subscriber-ship by earning slightly less, which over 24 months is only a difference of less than $3.13 pre month. This can said for any vendor's device so long as we don't see the vendor dropping prices.

While it would be unlikely for Apple of old to offer special wholesale pricing to carriers or dealerships, it does not mean Apple isn't offering some short-term special offers to various outlets to spur sales and garner more attention-getting buzz. This kind of attention costs dearly through advertising, if it can be accomplished through social media for less, or at the same cost for a bigger bang, it makes sense to do so.

Such targeted sales are common in the retail market for other products and brands. For Apple to do it makes sense (even though it has not been previously done by Apple). A company that is excellent at marketing will not be a standing target for its competitors to shoot at. Remember how it was only a few short years ago. Everyone knew that Apple would be releasing a new iPhone on a certain date with a certain price and planned their releases to take advantage of those known facts. Now, things are not so certain. Apple changes up the dates a bit, offers two new iPhones at two different price points instead of one. They are doing some dodging and weaving now... why not with special pricing?

The Smart phone market is moving into a more mature market, changing times calls for changing methods...
post #26 of 45

I checked on this deal this morning. I considered going with it for a year because I don't mind eating some of the upfront costs while the "rebate" of $200 per line comes in 90 days. It was actually a bit less per month however there were still several problems.

 

1. They wanted $35 per line to activate a sim and I have five lines. I'm paying $180 to activate five sims.

2. There isn't really any tools to limit the shared data. If a kid decided to stream Netflix without permission one night, I'd be the screwed one. On T-mobile our data is separate and better still the data doesn't stop, but slows down so they can learn about how they are using their phone.

3. Additional cost to tether. I buy the data, it is mine to do with as I want. Bad form AT&T. I love tethering my iPad to my iPhone.

4. Free international data and texting in 100 countries. This really is becoming a big deal. So many people in California travel back and forth to Mexico and I can text whomever I want while in Mexico. While I can't text from the U.S. to Mexico yet without a charge (weird I know) I can use a chat app and that app will still work on 2G when in Mexico.

 

AT&T basically wants to throw some money at you in hopes you won't realize their crappy policies are going to sting you. My five line plan with Tmobile is $130 and two lines have 2.5 gigs of data (the others have half a gig). AT&T wanted $195 for the same five lines to share 4 gigs total.

 

I feel like Tmobile is really applying the pressure here since the incentives are aimed directly at Tmobile. I suspect a lot of folks like us have taken unlocked iPhones over to their network where the 3G has been re-farmed.

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post #27 of 45
Quote:
Originally Posted by Macky the Macky View Post

While it would be unlikely for Apple of old to offer special wholesale pricing to carriers or dealerships, it does not mean Apple isn't offering some short-term special offers to various outlets to spur sales and garner more attention-getting buzz. This kind of attention costs dearly through advertising, if it can be accomplished through social media for less, or at the same cost for a bigger bang, it makes sense to do so.

Such targeted sales are common in the retail market for other products and brands. For Apple to do it makes sense (even though it has not been previously done by Apple). A company that is excellent at marketing will not be a standing target for its competitors to shoot at. Remember how it was only a few short years ago. Everyone knew that Apple would be releasing a new iPhone on a certain date with a certain price and planned their releases to take advantage of those known facts. Now, things are not so certain. Apple changes up the dates a bit, offers two new iPhones at two different price points instead of one. They are doing some dodging and weaving now... why not with special pricing?

The Smart phone market is moving into a more mature market, changing times calls for changing methods...

Absolutely.

Two point…

I would image a vendor in Apple's position would have written their deals to protect themselves from resellers who might wildly alter prices in certain ways to create certain types of buzz. They can do it but only after getting approval from Apple. This would help safeguard Apple from potentially having their brand diminished.

It would behoove a vendor in Apple's position to increase unit sales without losing face to do so through their distributors. They could even be the ones make the suggestion to a distributor. For example, "We'll give you $65 off each unit you sell if you lower the device cost for each unit sold by $75 for the month of January." I didn't make them the same value because because offering the deal to only Best Buy they know they have an upper hand and it would still be profitable when you factor in other revenue streams from activating an iPhone at BB to having a shopper in the store.

This goes for any vendor but until we have proof this is happening we have only our speculation.

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post #28 of 45
Quote:
Originally Posted by SolipsismX View Post


Absolutely.

Two point…

I would image a vendor in Apple's position would have written their deals to protect themselves from resellers who might wildly alter prices in certain ways to create certain types of buzz. They can do it but only after getting approval from Apple. This would help safeguard Apple from potentially having their brand diminished.

It would behoove a vendor in Apple's position to increase unit sales without losing face to do so through their distributors. They could even be the ones make the suggestion to a distributor. For example, "We'll give you $65 off each unit you sell if you lower the device cost for each unit sold by $75 for the month of January." I didn't make them the same value because because offering the deal to only Best Buy they know they have an upper hand and it would still be profitable when you factor in other revenue streams from activating an iPhone at BB to having a shopper in the store.

This goes for any vendor but until we have proof this is happening we have only our speculation.

 

According to talks with a contact at BBY, they eat the discount. Carriers and Apple make up wide majority of sales. So promotion through BBY wouldn't do much to move the needle for Apple, but it does for BBY. Get people in stores, attach high margin accessories, etc. Discounts can only be temporary. Apple doesn't want to lose sales to its own stores. But also wants to keep resellers happy so that is why they allow them to discount. 

 

However, there are instances, typically with other brands that have short life, where vendor will add sales support, reimbursing the discount. This happens when inventory levels are high, and for the vendor to sell more, the reseller has to move existing inventory. Samsung is notorious for this. They basically force resellers to take on huge shipments, which leads to them carrying less of competing products. Then will offer promotions so the reseller can clear inventory. 

post #29 of 45
But...but...but iPhones sell as fast as they can be made, there's NEVER a discount on iPhones.
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post #30 of 45
Quote:
Originally Posted by Turley Muller View Post

According to talks with a contact at BBY, they eat the discount. Carriers and Apple make up wide majority of sales. So promotion through BBY wouldn't do much to move the needle for Apple, but it does for BBY. Get people in stores, attach high margin accessories, etc. Discounts can only be temporary. Apple doesn't want to lose sales to its own stores. But also wants to keep resellers happy so that is why they allow them to discount. 

However, there are instances, typically with other brands that have short life, where vendor will add sales support, reimbursing the discount. This happens when inventory levels are high, and for the vendor to sell more, the reseller has to move existing inventory. Samsung is notorious for this. They basically force resellers to take on huge shipments, which leads to them carrying less of competing products. Then will offer promotions so the reseller can clear inventory. 

I agree with all of this in regards to what is most likely but the odds of their being occasions, even if short in duration, where Apple has produced too many of a model or wants to shore up some sales before a certain date that might behoove them to sell at a short term discount to maximize profits statistically has to happen from time to time. I don't see anything that says Apple set this particular BB deal in motion but I also don't think we can discount it as being impossible.

"There is no rule that says the best phones must have the largest screen." ~RoundaboutNow

 

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post #31 of 45

From WSJ today ---

 

"AT&T and T-Mobile were slated to be merger partners three years ago, but the Justice Department scuttled the $39 billion deal over concerns it would leave the market too concentrated. Antitrust officials wanted to preserve T-Mobile as a disruptive force in the market."

 

Thank you DOJ.  Competition = Lower Prices.  Yeah, baby !!

post #32 of 45
Originally Posted by dasanman69 View Post
theres NEVER a discount on iPhones.

 

Correct: Apple never discounts iPhones, as Samsung cuts its own prices on its devices.

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post #33 of 45
Quote:
Originally Posted by Tallest Skil View Post

Correct: Apple never discounts iPhones, as Samsung cuts its own prices on its devices.

Sure they do.
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post #34 of 45
Haha! I love it. T-Mobile is set to announce a $350 credit helping people migrate onto their network. What does Ma Bell do? Ups the ante. Guess who wins? Consumers!
post #35 of 45

It is funny AT&T was forced to do this a few weeks after their CEO was quoted as saying subsidies were going away.  :lol:   Makes me think Stephenson really doesn't know what he's talking about.  

post #36 of 45

Does this mean that AT&T is offering up this $200 credit in order to lock new customers into a contract? Not exactly an attractive trade off to T-Mobile customers, many of whom migrated there in order to get away from contracts.

 

From what I've read, the rumored T-Mobile plan will pay the termination fee (up to $350) to anyone on contract with a competing carrier.  That plan basically offers up the credit in order to more rapidly move customers from a contract into a contract-free plan.

 

If it requires a contract, the AT&T plan would do exactly the opposite -- move a contract-free T-Mobile customer into a contract. 

post #37 of 45
Interesting, when I asked ATT to refund me upgrade fee $39 or I jump the ship to T-Mobile, they said NO PROBLEM, GO. So I went, and I will never ever look at ATT again.
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Marquiz d' Gabber von Gabberaarde

... and Windows Vista...
... fails on the Moon...
... 6x slower!
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post #38 of 45

The main reason they had subsidies was to encourage ppl to move to higher paying plans. They already have ppl hooked on smartphones who didnt have them 2-3yrs back and they wont be going back.

I never got a subsidized phone i always paid full price and pay very little for everything unlimited.

most high end phones cost 600+ but googles nexus phone are like 350 and they are better then most high end phones. very feature rich like phone used as credit card/wireless charging. google nexus phones always have the latest technology in them

 

if i add up what i pay over 2 yrs with the low low price plan i pay and the very capable nexus phone . i save a shit load of money.

 

some cheap gsm plans

-straight talk att $45 - this is lte unlimited plan which throttles at 2.5gb

-straight talk tmo -$45 same limit as att. but att has better courage area. tmo has free hotspot

-go smart mobile -$45 for 5gb of 3g data everything else unlimited

-tmo data centric plan -$30 for 5gb of 4g data unlimited txt but only 100mins

-simple mobile- $40 unlimited everything data throttled after 1gb

post #39 of 45
Originally Posted by Mike Snoow View Post

-simple mobile- $40 unlimited everything data throttled after 1gb

 

On whose network does SM piggyback and what are their terms for using said data?

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Originally Posted by asdasd

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post #40 of 45
Bash AT&T all you want. I have a $90/month plan w5gb data, 450 anytime minutes and no texting. Tethering is included.

I use google voice and talkatone VoIP so that I never use all 450 minutes. talkatone also allows for free SMS.

Google voicemail is far superior to visual voicemail. I never give out my real number - only GV. call blocking works great. Voicemail doesn't use my minutes up.

Twice I went overseas and incurred a ginormous bill. Both times I called AT&T before and after, and they cheerfully refunded my money.

Any issues I've ever had were always resolved quickly and nicely.

Want to read monkeys using typewriters? Check the AT&T customer forums. Most cellular complaints are idiotic.

I had a major fight years ago with Verizon when I returned a phone and they said they never got it. I gave them the fedex tracking number that showed they did.

30 days later they reported me to the credit bureaus as delinquent. I disputed it and they did too, I lost and it stayed on my report for 7 years.

My wife has the grandfathered unlimited data and they never throttle her. A friend of mine has the same, and an iPhone 3GS.

She's going tomorrow to get a free iPhone 5c from BBY.

I'm happy with AT&T service. Could be cheaper, but it just works and I can be 25 days late paying and they don't shut me off.

That's reality. YMMV. Sucks to be you?
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  • Retailers discount iPhone 5s down to $120, AT&T offers customers $450 to leave T-Mobile [u]
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