AT&T Mobile CEO sees phone subsidies coming to an end
posted by Alan F. / Jun 02, 2015, 10:46 PM
AT&T is moving its customers away from subsidies. This week, it stopped offering two-year contracts at third party retailers like Best Buy and the Apple Store. Overall, two-thirds of AT&T's smartphone sales last quarter were done on AT&T Next. This plan allows equipment buyers to pay the full retail price of a new phone using monthly installment charges. For example, the 32GB Samsung Galaxy S6 will cost you $199.99 with a signed two-year pact. Over the 30 month AT&T Next 24 plan, the phone is priced at $0 down and $22.84 a month. The 24 month Next 18 plan requires monthly payments of $28.55. The AT&T Next 12 plan lets you pay $34.25 a month for 20 months.
It was T-Mobile that first started eliminating subsidized phone sales, but it is Sprint that is catering to the spec junkies who have the need to upgrade every year in order to have the latest hardware. By offering its customers a lease contracts, Sprint subscribers get to save a little money over an outright purchase. They also get to use the latest device and have the opportunity to trade in the leased model for the next hot phone. The downside to leasing is the lack of ownership, and the pressure to keep the leased unit looking new.
source: re/code via AppleInsider
Fine. Then drop the monthly prices to $30 for unlimited everything like the Europeans, American wireless providers are greedy c#cksuckers
posted on Jun 02, 2015, 10:53 PM 11
Posts: 7369; Member since: Mar 16, 2013
The other thing that is changing is the price of some really good devices are selling off contract for some exceptional price's. For example the Asus ZenFone 2 that comes 2/4 GB of ram and either 16/64 GB of storage for either $199 or $299. There is many other examples of inexpensive, but really good smart phones like the Moto G, Alcatel idol 3, and many more. I think this is the new trend.
posted on Jun 03, 2015, 12:15 AM 3
Posts: 328; Member since: Aug 01, 2012
yup! if they drop the carrier subsidy, then the manufacturers will have to drop their crazy 300-400% profit margin. Asus, one plus, even some HTC, Motorola, Nexus, etc all woul dbe cheaper, and then why buy AT&T? Just buy unlocked and check to see the correct LTE bands. If not, Cricket or H2O works. it will be like in europe in less than decade. just watch. 10 years ago we didn't have pre paid everything. I remember i used to pay 40 bucks plus tax for 500 minutes and 250 texts, not it's all unlimited. So we r getting there.
posted on Jun 03, 2015, 10:12 AM 1
As long as I get to keep my unlimited data (and according to recent court ruling - unthrottled), I will not switch. I sell my iPhones for more than the subsidized price of a new one every 2 years, get a new model, keep the rest of the cash. (the "S" models for iPhones are always better upgrades than the Body Changing models, anyway)...
posted on Jun 03, 2015, 2:01 AM 2
Posts: 536; Member since: Jun 06, 2009
Customers are choosing 2 years less because you forced them. AT&T better not go the way of Verizon and make customers with unlimited pay full retail up front for new devices. They will lose customers. Sprint is doing it right. They have loyalty offers for its tenured customers on "legacy" plans. Yes this is leasing and it is not as scary as this article implied. "The pressure to keep the phone looking new"...yes you have to turn the device in, but it doesn't have to look brand-new. There can be some where and tear just no cracked screens, missing buttons, liquid damage...it has to function properly. Just like all the other carriers Sprint offers device protection the majority of customers participate in this program. This way you can get maintenance performed on the device. If you have a catastrophic issue with the device (smashed, lost or stolen, liquid) file a claim and you'll get a new one next business day. There really is "no pressure" from leasing on Sprint. It's a new concept and it appears to be working for them. Essentially we use these things for 2 years or less and pitch or throw them in a drawer anyways...it's like beer you don't own to you rent it...
posted on Jun 03, 2015, 6:55 AM 1
Posts: 283; Member since: Jun 09, 2012
Everyone complains that it is the carriers that are greedy by ending subsidies. American consumers have a sense of entitlement and no sense of business in the wireless industry. Subsidies were fine when the cost of manufacturing was low and retail value of a handset was around $200. Now that phones cost more than that to manufacture and retail for upwards or $1000, it is not practical to subsidize $800. With operating costs, it would take the entire length of the contract to break even. No one takes into account all the money companies invest in overhead. Things like network build out and maintenance, paying employees, paying rent and utilities for a store. It's a business. They still need to make money too. It's not a charity.
posted on Jun 03, 2015, 6:57 AM 1
YOU aren't taking into account that US carriers RAPE us with high monthly fees and data charges !!!!
posted on Jun 03, 2015, 12:09 PM 2
Posts: 10; Member since: Dec 18, 2013
You sir obviously don't understand the difference between retail and wholesale pricing. With AT&T, Verizon, Sprint, and T-Mobile having a combined market cap of ~$425B, I think we're pretty far away from having to worry about them being charities.
posted on Jun 03, 2015, 1:55 PM 1
Posts: 266; Member since: Oct 09, 2014
Did people honestly think you could buy a 600 or 700 dollar phone for 199.99 and you would be able to leave without paying the full cost? Smh, subsidized contract or not you eventually would end up paying full retail whether you realize is or not. This option is much better since your no longer being lied to.
posted on Jun 03, 2015, 7:17 AM 1
You realize these D-bags STILL want to charge us the same monthly prices they were previously, but now they want to REMOVE the subsidy, right? Do the math. They want to raised the costs almost $500 over a 24month period. If these D-bags want us to pay for our our devices like the Euros, they need to offer Euro plans that are $30 for EVERYTHING UNLIMITED.
posted on Jun 03, 2015, 12:07 PM 1
Posts: 2458; Member since: Nov 28, 2009
If it wasn't for Aio/Cricket and the fact they let you keep unlimited data on legacy plans, this guy would be on a "Punch in the Yambag" list. Nowhere near as bad as the narcissistic asshats at Verizon, however.
posted on Jun 03, 2015, 5:46 PM 1
Send a warning to post author
Send a warning to Selected user.
The user has 0 warnings currently.
Next warning will result in ban!
Ban user and delete all posts
Message to PhoneArena moderator (optional):