It's time for a shift in contract terms......

Scholar

It's time for a shift in contract terms......

There was a time when a phone purchased under the two year contract was fine. Technology didn't grow as fast, nor did the demands of the customer, the network, etc.

But now the landscape of the wireless industry has completely changed, and continues to do so at an amazing pace. The rapid advancement of operating systems and related apps is also growing at the same pace. 

The older two year contracts are in fact obsolete when considering the extremely quick technology growth. Especially when combined with ATT's total lack of updates. Android 1.5 was released nearly two years ago, and most apps now wont work with it, not to mention the lack of flash and numerous other applications. It appears that android is progressing about three generations a year.

Where does that leave the customer? Those with iphones might be ok, at least the last generation was given the option to upgrade their os. WP7 will also get updates, but being a new os they're probably under more scruteny to 'get it right' than otherwise. The rest of us (android) are pretty much scr$w&# (I'll avoid the custom rom issue, since it technically voids the warranty and isn't an 'easy/simple' option for all).

A one year contract seems much more reasonable these days. I'd have no problem if my phone, which came with update promises (dell streak), saw them. As it is, I'm now stuck with an 18month old operating system that's at leat four generations behind, and can't do many of the things I'd like or need to do.

Message 1 of 34 (1,709 Views)
Master

Re: It's time for a shift in contract terms......

Your not going to see that.

 

The contract is for the subsidized phone.  If they were to shorten your contract down to one year then the only reasonable thing would be to make you pay more for the device itself (reduce the subsidy amount by half).

 

If your unhappy with the contract you can just purchase a phone outright and not have to be tied to a contract.  You can also get that phone unlocked/unbranded and have a better chance of receiving updates rather than hope AT&T releases something.

Message 2 of 34 (1,619 Views)
Scholar

Re: It's time for a shift in contract terms......

Hes right about the technology growth.Ive said it here before. Theres no reason any and all updates shouldnt be released. The tech is comin so fast that theres no need for them to worry about their latest phones having the latest OS. Therell be another 2.3,4,5 etc here before u knowit. Comprende?
I once asked how much do u think carriers pay for the phones. Thatd go a long way in knowing if the its viable for the carriers to give us 1 year contracts.How much could they possibly lose by giving us 1 year contracts?That & an unlimited plan would keep a huge % of ATT custys loyal.
Message 3 of 34 (1,592 Views)
Expert

Re: It's time for a shift in contract terms......


Tilt-A-Rama wrote:
Hes right about the technology growth.Ive said it here before. Theres no reason any and all updates shouldnt be released. The tech is comin so fast that theres no need for them to worry about their latest phones having the latest OS. Therell be another 2.3,4,5 etc here before u knowit. Comprende?
I once asked how much do u think carriers pay for the phones. Thatd go a long way in knowing if the its viable for the carriers to give us 1 year contracts.How much could they possibly lose by giving us 1 year contracts?That & an unlimited plan would keep a huge % of ATT custys loyal.

Actually agree with both of you - best bet - drop the subsidized pricing / contracts on the phones, everyone pays full retail so they can change phones anytime they want. Want a 16GB iphone - 699.00, 32 GB - 799.00,  Sony Xperia - 599.00. This way everyone wins, no 2 year contract and you change phones as often as you like. The terms of service for the network would remain the same, required data plans, etc would all remain in affect, the only difference would be that you pay full retail and have no 2 year requirement.

Message 4 of 34 (1,585 Views)
Professor

Re: It's time for a shift in contract terms......

I have thought for a while that I would be happy paying full price for a phone and not having a contract.  You can do that now.  I would, however, like to see at&t give a discount on service.  The reason for the 2 year contract is to make sure you will have service long enough to make up for the subsidised price for the phone.  If they are not going to subsidize the phone, we shouldn't have to pay the extra on our bills to pay for the subsidy. 

 

For phones with SIM cards, you could even start selling phones in retail stores independant of buying service, much like we buy our wired phones at any department store to access our landline carriers.

Message 5 of 34 (1,555 Views)
Professor

Re: It's time for a shift in contract terms......

I fully support this. Competitiveness would force the carriers to lower the cost of service. I believe the subsidizing is what is pushing many customers into smartphones when they really don't need one or can't afford to use one. Buying directly from the manufacturers or their sellers would allow users to get their updates directly from the manufacturers. However, I don't see this happening because of the desire from the carriers to limit the capabilities of the phones. No manufacturer is going to want a carrier telling them to add bloatware and dictate what features they can and can not make functional on their device if the carrier is not buying directly from them and then reselling. This would put it back at square one where the carriers would want a custom rom and custom updates and the manufacturers would have no reason to play that game, another stalemate. 

Message 6 of 34 (1,546 Views)
Scholar

Re: It's time for a shift in contract terms......

Maybe it's also time to fairly price some of ATT's services. $10 for a service that has comperable apps for $1.99 no longer makes sense......Perhaps it's like the music industry, a major change is needed in their market approach, change or fade

Message 7 of 34 (1,534 Views)
Scholar

Re: It's time for a shift in contract terms......

 


Actually agree with both of you - best bet - drop the subsidized pricing / contracts on the phones, everyone pays full retail so they can change phones anytime they want. Want a 16GB iphone - 699.00, 32 GB - 799.00,  Sony Xperia - 599.00. This way everyone wins, no 2 year contract and you change phones as often as you like. The terms of service for the network would remain the same, required data plans, etc would all remain in affect, the only difference would be that you pay full retail and have no 2 year requirement.


My only problem with this is that the phones are far overprices as it is. Especially considering the lack of attention Samsung gives after release. Phones are 'like' small computers, but nowhere near them yet. And while the same seems to be said in a small way for the service plan pricing (text plans no longer make sense, just add it to data...but are probably a major cash cow), would prefer a subsidy. Removing that will only create a more expensive phones.

 

Message 8 of 34 (1,528 Views)
Expert

Re: It's time for a shift in contract terms......


diagoro wrote:

 


Actually agree with both of you - best bet - drop the subsidized pricing / contracts on the phones, everyone pays full retail so they can change phones anytime they want. Want a 16GB iphone - 699.00, 32 GB - 799.00,  Sony Xperia - 599.00. This way everyone wins, no 2 year contract and you change phones as often as you like. The terms of service for the network would remain the same, required data plans, etc would all remain in affect, the only difference would be that you pay full retail and have no 2 year requirement.


My only problem with this is that the phones are far overprices as it is. Especially considering the lack of attention Samsung gives after release. Phones are 'like' small computers, but nowhere near them yet. And while the same seems to be said in a small way for the service plan pricing (text plans no longer make sense, just add it to data...but are probably a major cash cow), would prefer a subsidy. Removing that will only create a more expensive phones.

 


one way or the other, don't want a contract, pay full price. All carriers have about the same pricing. ATT's "cash cow" of unlimited messaging for family plans of 69.99 or higher just became very reasonable with the additon of unlimited mobile to mobile calls to any carrier.

 

No removing the subsidy will not create more expensive phones, the end user will just see the true price, and it will add a additoinal level of competion in pricing by the manufacturer, since they will be competing at full retail cost rather then agreed on subsidized cost. Capitalism at it's best

Message 9 of 34 (1,514 Views)
Master

Re: It's time for a shift in contract terms......


diagoro wrote:

My only problem with this is that the phones are far overprices as it is. Especially considering the lack of attention Samsung gives after release. Phones are 'like' small computers, but nowhere near them yet.


Your mixing hardware and software into the equation.  What your basically stating is the pricing would be fine if the manufactures supported the operating system more with updates and new features.

 

The price on the hardware is due to build complexities with size and how many units are being sold and software is not "much" of a factor.  Then added what the market will bear (all companies are there for a profit).

 


diagoro wrote:

And while the same seems to be said in a small way for the service plan pricing (text plans no longer make sense, just add it to data...but are probably a major cash cow), would prefer a subsidy. Removing that will only create a more expensive phones.


There is more to texting that is what is generally seen with the need for message centers.

 

As for change, Apple tried that by not including texting and instead wanted people to use free instant messaging (which would have even allowed computers to easily message handsets also) and it was the users who fought back complaining they wanted standard text messages back.

I'm sure they would love to add it to data but then everyone that had messaging would be forced to add a data plan.  You will have people that will complain about that also.

 

Also a change would been to be more global (not just a US thing) as texting is pretty standard around the world.  Just having a few carriers participate won't benefit the system overall.

Message 10 of 34 (1,502 Views)
Scholar

Re: It's time for a shift in contract terms......

You guys talkin about how the contracts are so ATT can get their money back onthe phones is nonsence. Drop the subsidies and just makeit full price? What ru talkin about? The cheap phone are only for gettin u into contract.Over 2 years u give ATT $2-3,000. depending on plans. When u buy 50,000 phones I know u aint payin more than $100.-$200. each. Tops. The no contract price is way too much. $700 for an iphone,$500 for an Atrix? Please.....
They make their $ from u being lockedin for 2 years. And some of us lockedin for 2 years....with an OUTDATED OS! Dont believeit? What Im gonna do with my Inspire when LTE comesout,Im not sure. Everyone who buys a new "4G" phone is gonna feel kinda outdated when LTE comesout this summer.And 2.3 + dualcore+ffc etc.Its called planned obsolesence. Its nothing new. So Im locked in to a phone for 2 years that wont be able to use LTE for 1-1.5 YEARS.
Sorry,but faster is always better. Ill miss those blazin DL speeds till 2013.
Message 11 of 34 (961 Views)
Scholar

Re: It's time for a shift in contract terms......

It's nice how they ask customers to be patient with their service issues, usually stating "we're in the progress of making major improvements to our network". What they don't tell you is that that 'new network' will probably be locked to new phones with the proper technology AND come at plan prices above what we're paying now (not to mention the obligatory loss of any unlimited plan).

It's a business plan to make the most money for their investors. Nothing wrong with that on it's surface, it's what the 'free-market' approach. But between questionable service quality, total lack of software updates, and contract plans that work 85% in the companies favor, perhaps it's time for big brother to step in and shake things up.

I'm not for the government taking control, but it does seem that wireless service in Europe and Asia is a much better deal for the customer (Where in I may receive the obligatory response of 'you can always take your service there'). 

Message 12 of 34 (947 Views)
Master

Re: It's time for a shift in contract terms......


wingrider01 wrote:
.........................

 

No removing the subsidy will not create more expensive phones, the end user will just see the true price, and it will add a additoinal level of competion in pricing by the manufacturer, since they will be competing at full retail cost rather then agreed on subsidized cost. Capitalism at it's best


 

I agree - the subsidy arrangement only serves to mask from the customer the true price they are paying for the equipment and for their service agreement.  Separate the two and then you'll get true competition in both pieces of the equation in terms of both pricing and quality.

 

I've often felt it is ironic that in the US we have the least "competitive" form of wireless service provision compared to that of Europe, etc.  And while I didn't purchase it when it first came out, IIRC I only paid somewhere in the $300 range for my non-branded/unlocked Nokia E70-2 (smartphone).  Not that significantly more (imho) than the $150 I would have ended up paying for a completely locked down, crippled, subsidized at&t branded Nokia E71x approx. six months after they were readily available (non-branded E71-2) at Best Buy B&M stores in the US.  Plus, if there is one thing the success of the original iPhone "proved" - again imho - it's that Americans will spend incredible sums for a device that actually meets their desires.  So the old argument that Americans don't want to pay large sums for their equipment is completely false - we'll apparently do it in droves for a piece of equipment that is both carrier locked and not very functional, just because we like it.  lol.  But isn't that what free market competition is really all about? Smiley Wink 

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Message 13 of 34 (893 Views)
Scholar

Re: It's time for a shift in contract terms......

Thinking more about this, I would never expect American carriers to follow this model. I'm sure the idea is to make the service AND phone seem the most appealing from the start. After that it's all gravy for them. More expensive phones upfront means more people go with feature phones, minus the heavy data plans (with major overages) and access to an app store.

I'm guessing this is a major reason smartphones have become such a staple of the industry. Not just for the tech advances, but they allow the carriers so many more options to fleese their flock.

Message 14 of 34 (874 Views)
Expert

Re: It's time for a shift in contract terms......

[ Edited ]

diagoro wrote:

Thinking more about this, I would never expect American carriers to follow this model. I'm sure the idea is to make the service AND phone seem the most appealing from the start. After that it's all gravy for them. More expensive phones upfront means more people go with feature phones, minus the heavy data plans (with major overages) and access to an app store.

I'm guessing this is a major reason smartphones have become such a staple of the industry. Not just for the tech advances, but they allow the carriers so many more options to fleese their flock.


then there is no need to "shift the contract terms".  The removal of subsidized phone would provode the biggest shift in contract terms, the roi on anything else is not worth the effort by legal. Besides I suspect it would not be the company that would be reluctant to follow this model - they will win in the end, it will be the customer who realizes that their 199.00 Apple Iphone will now cost the 699.00 to have it you would the screams of anguish and the whines into the next galaxy

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