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Contract and subsidized prices

Contract and subsidized prices

Users are locked into strict 2-year contracts when purchasing a new phone at a subsidized price -- say an iPhone for $199.99 instead of the full price of $649.99. This I fully understand; the company needs to recoup the wholesale cost of the device through the contract (which is less than the consumer price, but regardless...). My question is, why is it that after the contract is up, the plan rates remain the same and not go down since the device is now "paid off"; and why do people who buy their own phones pay these same "subsidized device" rates?  Seems like AT&T (and all others) are having their cake and eating it too. 

 

Also, why aren't text messages charged by the data they use instead of the flat cover charge which is disproportionately high (in the neighborhood of 3000% higher)?

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Message 1 of 7
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ACE - Expert

Re: Contract and subsidized prices

It would be nice if they had a different rate for subsidized and unsubsidized plans but I don't see that happening any time soon.
This is a user to user forum. I am a user, just like almost everyone else on the site.
*The views and opinions expressed on this forum are purely my own. Any product claim, statistic, quote, or other representation about a product or service should be verified with the manufacturer, provider, or party.
Message 2 of 7

Re: Contract and subsidized prices

absolutely, I'm not that naive. I was just bringing to light the little white lie they get away with... that a contract pays for a phone and look! you're getting this terrific deal!

...nevermind that you will always pay the same rates regardless. Their entire business model is based around scams and lack of true competition and alternatives. When every other developed country pays significantly less for significantly better wireless service, you know something is seriously messed up around here.
Message 3 of 7
Expert

Re: Contract and subsidized prices


Virginia421 wrote:
absolutely, I'm not that naive. I was just bringing to light the little white lie they get away with... that a contract pays for a phone and look! you're getting this terrific deal!

...nevermind that you will always pay the same rates regardless. Their entire business model is based around scams and lack of true competition and alternatives. When every other developed country pays significantly less for significantly better wireless service, you know something is seriously messed up around here.

Not sure how i tis a little white lie - the cost of service is exactly the same if you subsidize a phone or if you buy one at full retail price, no where in any of the terms of service or other policies to they mention or even alude to the fact there is a difference in service cost. The only "compietition" (if they can be called that) is T-Mobile, neither sprint nor verizon offer a service discount.

 

As a world traveler for my business, I beg to differ with that last comment on "significately better wireless service", have phone from a couple of providers in europe, the only phone that I have come toprefer over there is the globalstar that I have. As long as I have line of sight to the satellites, other then that I will use the follow me number that is available on voip through the home bases Cisco UCS system that is installed.

Message 4 of 7
Teacher

Re: Contract and subsidized prices

It used to be years ago, (heck even 4-5 years) There were not many alternatives. These days MVNO's are EVERYWHERE as replacement. 

If you stay w/ AT&T and pay their regular plan pricing without a phone being subsidized... that's not smart.

Get the unlock code and go elsewhere or get a new phone.... else you're giving AT&T free money.

Message 5 of 7
Expert

Re: Contract and subsidized prices


n19htmare wrote:

It used to be years ago, (heck even 4-5 years) There were not many alternatives. These days MVNO's are EVERYWHERE as replacement. 

If you stay w/ AT&T and pay their regular plan pricing without a phone being subsidized... that's not smart.

Get the unlock code and go elsewhere or get a new phone.... else you're giving AT&T free money.


your choice, MVNO's do not supply the services and support that my business requires

Message 6 of 7
Professor

Re: Contract and subsidized prices


n19htmare wrote:

It used to be years ago, (heck even 4-5 years) There were not many alternatives. These days MVNO's are EVERYWHERE as replacement. 

If you stay w/ AT&T and pay their regular plan pricing without a phone being subsidized... that's not smart.

Get the unlock code and go elsewhere or get a new phone.... else you're giving AT&T free money.


It depends on what your needs and wants are as a customer.  I have tried a few MVNOs and over time, they weren't for me.  They didn't offer the LTE service that I want and the plans that I had were not much cheaper than what I pay for AT&T's service.  If you don't live in an AT&T LTE service area and unlimited minutes and text messages are important to you, MVNOs may be a better choice.

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