Verizon CEO: Going contract-free would be 'pretty easy'

24

Comments

  • Reply 21 of 68
    applegreenapplegreen Posts: 421member


    On T-Mobile, the phone prices are:


     


    1) iPhone 5 16 GB = $580


     


    2) Blackberry Z10 = $532


     


    3) Galaxy Note II = $680 (current promo = $640)


     


    4) Galaxy S III 16GB = $550


     


    5) Nexus 4 = $458 (The Nexus 4 16GB is $349 directly from Google).  Nexus 4 has no LTE.  So, can't really compare.


     


    These are the prices of every manufacturer's high-end phones whether you pay all at once or over 24 months.  There are many cheaper Android and Windows phones, but I just listed the high-end ones.


     


    The question is: how can anybody say that the iPhone is much more expensive than the competition?  For the small premium that you have to pay for the iPhone, you get so much more in terms of quality, service, resale value, ecosystem, and so on.


     


    If people think Samsung or Google will win over Apple, they are dreaming.

  • Reply 22 of 68

    Quote:

    Originally Posted by Michael Scrip View Post





    You're basically getting an interest-free loan on a $650 phone spread out over two years... versus paying the $650 in one lump sum up front. That's a big deal to some people.



    If you're gonna stay with the carrier anyway... why not let them finance the phone?


     


    And with T-Mobile's new plans, you're literally (not basically) getting an interest-free loan on a $650 phone (that you're actually paying $580 for). That's exactly what it is, it's part of the deal, and it's called the Equipment Installment Plan.


     


    If people would only spend 5 minutes reading up on these things before giving their opinions on them, these threads would be much shorter.


     


    Plus... how often would people change carriers if they could? Every 6 months? That would be a hassle... porting your number and such.


     


    There are other advantages as well. For example, if T-Mobile comes out with a new plan which is a better deal than the one you currently have, or if you decide you need a bigger plan with more GB per month, or if finances get tight and you need to downgrade to make ends meet, you are free to change it at any time. Plus, you're able to get a new phone whenever you want, just by paying off whatever balance remains on your current EIP (that interest-free loan that we talked about above).


     


    Plus, it's just nice to know that if you ever move somewhere where your carrier doesn't work, you're not completely screwed.


     


    Quote:

    Originally Posted by StephanJobs View Post





    Well follow my plan.



    I upgrade every 2 years. My bill is the same whether I upgrade or not.



    If I stay with the same carrier which I have for the past 4 years then I only pay 199$ for 16 gig iPhone



    If I understand the t- mobile plan it's 99$ upfront plus 20$ per month for 2 years.



    That's 340$ for the phone.



    So for me it's cheaper.


    That's actually $580 for the phone. Whoops! Also whoops in that you're missing a crucial fact, which is that contract plans include that extra cost, usually around $20 per month, to subsidize the phone price. It's just that that subsidy payment is baked into the plan price, instead of itemized separately. In other words, T-Mobile's honest about it. No way are you only paying $200 for that phone — that's less than it costs Apple to even make it ($207), let alone profit margins.


     


    On your other carrier, what you're really paying for the phone is $199 + $20/mo for 2 years, which comes out to $680. This is more than the phone's off-contract price of $650 — i.e., it's a rip-off. Add in that the contract plan is significantly more expensive even besides the subsidy payments, and you'll just about always spend a lot more on AT&T or Verizon than you will on T-Mobile.


     


    Contract plans are for people who can't manage fifth grade arithmetic.

  • Reply 23 of 68
    Of course going contract free is easy...its just anything but free. You pay for the phone up-front or in installments and still pay full price for the monthly contract. I highly doubt they will reduce their voice, messaging and data fees for monthly contracts. Don't think so? Verizon has a history of "screwing" their customers...41.4% profit margin and its still not enough, oh you were paying $30 for unlimited data...well now you pay $30 for 2GB, you want data sharing plan...ok give us more money, we'll give you less data and you can share between all your devices...great for investors but not for customers.
  • Reply 24 of 68
    christophbchristophb Posts: 1,482member
    Considering the spectrum diversity domestic and international coupled with a vague "less over time" comment, I'll reserve hope until I see the voice and data plan prices and what bands are covered. I was tmobile once when half my life was spent in the (now) EU and the always AP; I would certainly return. Back then I had to have 2 phones.
  • Reply 25 of 68
    philboogiephilboogie Posts: 7,674member
    m4mac wrote: »
    Based in London, I seem to have more choices than I can count (or shake a stick at) when I comes to upgrading my iPhone. However, I am staying with the strategy I adopted when iPhone 4 came out and that's buy the device outright and go with a month-by-month contract. In practice, I have not exercised my right to switch from Vodafone to SomeOtherCarrier %u2013 but it's nice to know I can.

    I too pay upfront for the iPhone (€873 incl. VAT, 64GB) and have the freedom to switch when I want to, or disable data if I'm out of the country for a month. In the end, I pay less than on a 2-year contract. And I get to sell my phone every year so I can get the latest version every time. Which now is easier than when on contract. Oh, and welcome to the forum.
    ^ picture

    Schmidt holding a Zune? Good one
    seeknemo wrote: »
    Of course going contract free is easy...its just anything but free. You pay for the phone up-front or in installments and still pay full price for the monthly contract. I highly doubt they will reduce their voice, messaging and data fees for monthly contracts. Don't think so? Verizon has a history of "screwing" their customers...41.4% profit margin and its still not enough, oh you were paying $30 for unlimited data...well now you pay $30 for 2GB, you want data sharing plan...ok give us more money, we'll give you less data and you can share between all your devices...great for investors but not for customers.

    All telco's have a history of screwing with their customers. In the US, a bit more, I'd say. Oh, and welcome to the forum.
  • Reply 26 of 68
    Contract plans are for people who can't manage fifth grade arithmetic.

    Maybe this new "no contract" plan will help T-Mobile.

    Prior to that... T-Mobile has always offered competitive prices compared to "expensive" carriers like Verizon and AT&T... yet their subscribership is small. T-Mobile has been the 4th place carrier (out of 4) in the US for quite a while.

    It's not just basic arithmetic that kept people away from T-Mobile... it was coverage and phone selection.

    I guess it depends on where you live... but I know very few people who have T-Mobile.

    The people I know that do have T-Mobile... went there purely on price. But I've never heard them say anything particularly good about it.

    Like I said... T-Mobile has always been cheaper than Verizon... so why aren't more people on T-Mobile?
  • Reply 27 of 68
    hmmhmm Posts: 3,405member

    Quote:

    Originally Posted by Ireland View Post





    Agreed. My brother in law bought a Samsung Galaxy (3 or 4) today (he knows nothing about phones), but he did ask me how much an iPhone costs about 3 months ago. I just knew when I saw that phone that he bought it because the iPhone 5 was too expensive. He asked me "is that a good phone?" when I had the phone in my hand, but the first thing I noticed was very pixelated anti-aliased text at the bottom of the screen. I was think Oh, WTF!?, but I played it cool and said I didn't know what type of phone it was. "Jesus I don't know what phone it is, what is it a galaxy?"



    When he went off I thought I should have said why didn't you get an iPhone? But I guess I knew the answer. I guess I was half thinking I wonder if the guy in the shop pushed it on him? I'm thinking the brother in law knew my answer was quite political. I could have just as easily vomited over the phone in reply to his question. It really was plastic, cheap feeling junk.




    I haven't checked current pricing, but the Galaxy S3 was roughly the same price as the iPhone 5. Some retailers might knock off $50-100 on sale for either, but I don't see how price would factor in between the two either on or off contract. Are you sure it wasn't a different model?

  • Reply 28 of 68
    chris_cachris_ca Posts: 2,543member

    Quote:

    Originally Posted by StephanJobs View Post





    Well follow my plan.



    If I understand the t- mobile plan it's 99$ upfront plus 20$ per month for 2 years.



    That's 340$ for the phone.


    ???


     


    Its $579.

  • Reply 29 of 68
    chris_cachris_ca Posts: 2,543member


    Watch what happens.


    Next iPhone is released (July-Sep) then 2-3 months later Verizon/AT&T/Sprint change their plans to compete with T-Mo (after new iPhone customers are already locked into contract).

  • Reply 30 of 68
    antkm1antkm1 Posts: 1,441member
    ascii wrote: »
    If you think you will be using it for 2 years anyway, then a contract is usually the better deal. Data is definitely more expensive on pay as you go.

    It's all relative to the pricing structures available on the current market. Working in another country where pricing models are pay-as-you-go primarily, I can clearly see how ripped off the customer is in the USA. In China, you pay up front for the phone, yes that's expensive. But, the pricing structures for phone and Data is extremely lower than the USA. Voice and text and about 1/3 cent per minute and 1/2 cent per text. Data I paid about 3$ for 100 mb of data, 500 MB for about $8-$9. Everything is rechargeable from prepaid phone cards. Sure, there are monthly plains and annual plans as well, and they are fractions of what they are in the USA.

    Sure, one could argue with 1.4b people there and its economy of scale, but a much smaller % of those people are actual cell phone users.

    All I'm saying is that the prices are so overinflated in the US that even if the major carriers switched to PaYG, it's still a slap in the face to the customer. It really opened my eyes to see what just one other country does with phone/data service it really makes me feel like I should change my plan and get a feature phone. The sooner Apple can produce the iPod touch with 3G data and an all-data phone app the better off the customer will be and the less empowered the carriers will be.
  • Reply 31 of 68


    I'm surprised to the few idiots here stating 2 year contracts are just fine... shouldn't be surprised though. I ask why? Why is a 2 year contract good? Being locked in? Paying same price regardless of device being "paid off". No wonder telco's get away with robbery, there's idiots like these hanging around. Yeah, this isn't a nice post but sometimes people need to be called out so they get their head out of their ass and actually pay attention to what's going on.

  • Reply 32 of 68
    antkm1antkm1 Posts: 1,441member
    Sure,
    Well follow my plan.

    I upgrade every 2 years. My bill is the same whether I upgrade or not.

    If I stay with the same carrier which I have for the past 4 years then I only pay 199$ for 16 gig iPhone

    If I understand the t- mobile plan it's 99$ upfront plus 20$ per month for 2 years.

    That's 340$ for the phone.

    So for me it's cheaper.

    T-mobile may have cheaper plans data and service wise but with that I would just compare the pros and cons individually between the companies.

    Id rather not risk jumping ship for saving a few buck on that issue.
    th phone is cheaper on a subsidized plan, but that's not the biggest cost over the run of the contract...it's the service. My iphone cost me $50 up front but it still pay $85/mo. On service for 2 years. That's $2,040 for two years. Compare that to a PaYG plan from anyone else. The Telco's put a premium price tag on the iPhone...including the service.
  • Reply 33 of 68
    jlanddjlandd Posts: 873member


    Ugh, this guy is such a tool.  I've been waiting for all four of my family plan's phone contracts to expire (three non-smartphones and one iPhone) just to get off Verizon in NYC.  No complaints about the reception but everything else about being a Verizon customer is like bamboo shoots under the fingernails.  Already priced it out and it is much cheaper to go monthly elsewhere than stay with Verizon 2 year contracts, it's no contest.  Don't know why people are saying it's cheaper because it's not.   I've had a similar plan for multi phones for 15 years and with at least one smartphone for the last 6, and I can't wait to leave Verizon for monthly plans.  

  • Reply 34 of 68
    apple ][apple ][ Posts: 9,233member


    I think that a lot of people out there must be fools if they think that their phone only cost them $99 or $199 on contract. They're paying for the phone all right, they're paying out the ass for their phone over the period of their contract. Monthly mobile phone plans under contract in the US are ridiculously high, and I think that subsidized phones are a big part of the reason why. People are probably paying more than full price for their phone under contract. Apple and other companies make money from selling their phones to the cellular companies, and the cellular companies make money from you by charging ridiculous monthly rates.


     


    I'd much rather just own something outright, instead of having it subsidized. We're not talking about buying a brand new car here or somebody who is trying to finance a house, it's just a damn phone.

  • Reply 35 of 68
    Verizon needs to stop being so f'ing greedy and bring back unlimited data plans
  • Reply 36 of 68
    philboogiephilboogie Posts: 7,674member
    apple ][ wrote: »
    I think that a lot of people out there must be fools if they think that their phone only cost them $99 or $199 on contract. They're paying for the phone all right, they're paying out the ass for their phone over the period of their contract. Monthly mobile phone plans under contract in the US are ridiculously high, and I think that subsidized phones are a big part of the reason why. People are probably paying more than full price for their phone under contract. Apple and other companies make money from selling their phones to the cellular companies, and the cellular companies make money from you by charging ridiculous monthly rates.

    I'd much rather just own something outright, instead of having it subsidized. We're not talking about buying a brand new car here or somebody who is trying to finance a house, it's just a damn phone.

    Fully agree. That's why I bought the iPhone online and use SIM-only instead of a subscription. Cheaper this way, and I can renew easily at every new model.
  • Reply 37 of 68
    michael scripmichael scrip Posts: 1,916member
    apple ][ wrote: »
    I think that a lot of people out there must be fools if they think that their phone only cost them $99 or $199 on contract. They're paying for the phone all right, they're paying out the ass for their phone over the period of their contract. Monthly mobile phone plans under contract in the US are ridiculously high, and I think that subsidized phones are a big part of the reason why. People are probably paying more than full price for their phone under contract. Apple and other companies make money from selling their phones to the cellular companies, and the cellular companies make money from you by charging ridiculous monthly rates.

    I'd much rather just own something outright, instead of having it subsidized. We're not talking about buying a home here, it's just a damn phone.

    True... part of your monthly bill is the subsidy. But it's not that much of it.

    A 16GB iPhone, for instance, is $650... and you must pay $200 up front. The remaining $450 is spread out over 24 months... which works out to about $20 a month.

    The biggest part of your phone bill is the service itself. You're right... that's where the carriers make their money.

    I think the average monthly cell phone bill in the US is around $80 a month... so the carriers could be making around $60 a month... per customer.

    And Verizon, for instance, has 100 million wireless customers.

    No wonder Verizon has a 42% profit margin.

    Now... they're not just sitting on all that money... Verizon spends billions every quarter improving their infrastructure. But still.

    It's shocking to realize how much money they make... and how much we pay.
  • Reply 38 of 68
    richlrichl Posts: 2,213member


    I prefer the contract free model, mostly because it encourages networks to compete openly on price. Every time I decide swap networks, I'm offered a stupidly good deal to stay. I'm currently paying less than $10 a month for 300 minutes, unlimited texts and unlimited data. Whenever I fancy buying a new iPhone, I go buy it direct from Apple.

  • Reply 39 of 68
    irelandireland Posts: 17,793member
    hmm wrote: »

    I haven't checked current pricing, but the Galaxy S3 was roughly the same price as the iPhone 5. Some retailers might knock off $50-100 on sale for either, but I don't see how price would factor in between the two either on or off contract. Are you sure it wasn't a different model?

    Am I living in the US?

    http://shop.vodafone.ie/shop/phones-and-plans/phones/pay-as-you-go/phone-details/apple-iphone-5-16gb
  • Reply 40 of 68
    dasanman69dasanman69 Posts: 13,002member
    seeknemo wrote: »
    Of course going contract free is easy...its just anything but free. You pay for the phone up-front or in installments and still pay full price for the monthly contract. I highly doubt they will reduce their voice, messaging and data fees for monthly contracts. Don't think so? Verizon has a history of "screwing" their customers...41.4% profit margin and its still not enough, oh you were paying $30 for unlimited data...well now you pay $30 for 2GB, you want data sharing plan...ok give us more money, we'll give you less data and you can share between all your devices...great for investors but not for customers.

    Is Apple the only one allowed to have healthy profit margins?
Sign In or Register to comment.