Verizon confirms move to 12-month payments for devices with no contract ties

Verizon confirms move to 12-month payments for devices with no contract ties
Verizon Wireless has just updated its smartphone purchase program making it look much more like T-Mobile’s Un-carrier initiative. Starting April 21 Verizon customers would be able to buy a phone at its full price before the end of their contract and some devices will be offered on a 12-month instalments via the Verizon Wireless Device Payment Plan.

This is a big change from the current policy that only covers tablets costing at least $349.99 and the Samsung Galaxy Camera. After the changes take effect, customers will be able to buy up to two gadgets, and whenever they pay off one of them they’d be able to immediately purchase a new one to fill the two device limitation.

"The first installment and finance charge is due at the time of purchase," the company said. "Subsequent installments and finance charges will appear on your monthly Verizon Wireless bill and will be listed separately from your other charges. Qualifying devices must be $349.99 or more per device, after all discounts and promotions and before taxes are applied."

T-Mobile’s Un-carrier initiative brings a radical change to the 2-year upgrade model used by US carriers and this obviously comes as a reaction to it.

"I'm happy when I see something different tried. We can react quickly to consumers' shifting needs," Verizon CEO Lowell McAdam said earlier.

source: Verizon Wireless via Tom’s Hardware

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70 Comments

1. thisivi3

Posts: 2; Member since: Apr 17, 2013

Finance Charge.... Even T-Mo doesnt do it.

11. akki20892

Posts: 3902; Member since: Feb 04, 2013

but Verizon do that

37. TheMan

Posts: 494; Member since: Sep 21, 2012

This is nothing like TMO's UNcola...I mean, UNcarrier initiative because Verizon is still charging you the same monthly fee as someone whose phone was subsidized (meaning the service fee includes the repayment cost of the equipment buried in the numbers).

39. tomn1ce

Posts: 248; Member since: Mar 12, 2012

On top of the full price of the device and the same monthly fee as everyone else they're charging a finance fee...I knew they were up to no good in trying to mimic tmobile uncarrier idea...

40. MikeG77

Posts: 426; Member since: Nov 24, 2008

I knew Verizon would pull some crap like this. Here is a few simple solutions for anyone that may pursue this option. 1. Buy full retail. 2. Buy the phone 2nd hand from someone else. If those 2 options i would recommend the finance option depending on what these so called "finance charges" are going to cost you.

48. ardent1

Posts: 2000; Member since: Apr 16, 2011

Verizon likes to nickel and dime its customers to death. Since interest rates are really low, it might not be bad if the interest cost is less than 5%. Anything more than 7% in today's environment is highway robbery.

2. jcpwn2004

Posts: 314; Member since: Jan 18, 2012

so now you pay 350$+ for your device plus at least 150$/mo lol. I'm sure there will be plenty of extra fees with this too.

32. Rockbottom97

Posts: 27; Member since: Jan 08, 2013

That's not how it works. You have to purchase a device thats over $349.99. Then you divide the total price by 12. You will pay your 1st installment in the store or online, then your bill in the next 11 months will add each installment. You can pay off the device at anytime.

43. MikeG77

Posts: 426; Member since: Nov 24, 2008

I think your missing a very important point in the article in that they pay an initial finance charge as well as the initial installment. The question is that....does someone have to pay finance fees durring the next 11 months?

3. InspectorGadget80 unregistered

This is going too suck. I just hope at&t/sprint wont follow.

4. DrSchlotkin

Posts: 7; Member since: Apr 17, 2013

Hrm... Let me get this straight... I can now purchase a phone at full price and pay a monthly finance charge directly to verizon.. How is this any different than say using a credit card to purchase your device? It isn't like Verizon is lowering their service charges for these non-contract phone lines. At least with a credit card you can earn points or other discounts. Verizon really is making me sick recently. If I didn't still have unlimited LTE data, I would have left ages ago.

13. infinitemethod

Posts: 151; Member since: Sep 04, 2012

It's like $2 or $2.50/month. Over a year that is less than the activation fee/upgrade fee they charge now. It also allows people not to be in contract and not have to deal with hefty EFT fees.

35. TheMan

Posts: 494; Member since: Sep 21, 2012

Hmmm, there's a thought. Would this be considered a subsidized purchased? I think not, which would mean that one would be able to keep one's unlimited data plan on Verizon. Think about it.

42. tomn1ce

Posts: 248; Member since: Mar 12, 2012

Before I go ahead and pay full price to vzw for a device I prefer to buy the device somewhere else....

45. MikeG77

Posts: 426; Member since: Nov 24, 2008

I would say no this is not subsidized BUT it wouldn't suprise me if Verizon used this as an exscuse to take someone's unlimited data away.

41. trexnkrumpets

Posts: 45; Member since: Jan 15, 2013

It's tmobile not verizon. Verizon just wants to be secure incase some of their customer decide to flock over to tmobile which... in reality probably won't happen. But! For some people these new "plans" can be beneficial IF you don't upgrade your phone every 2 years, but more like every 3-5 years. If they follow suit with tmobile they will lower the monthly charges by a OK amount. [nothing too drastic]

5. AndiAllDay

Posts: 14; Member since: Apr 11, 2013

Scam, Scam, Scam! Any phone company will do every and anything to get money out of its customers!

16. kaintae

Posts: 98; Member since: Dec 14, 2011

What part of this is a scam?

17. Daftama

Posts: 641; Member since: Nov 03, 2012

Lol. I dont maybe we are still locked until we pay it off which will take two years. If I got a contract and canceled it...350 for ccanceling 200 for phone 550 comes to the price of the phone..now how many ppl really cancel it. ..oh it doesn't change the price of the plan ot should be cheaper so your right which part is scam

18. Daftama

Posts: 641; Member since: Nov 03, 2012

Sorry the fact they will charge more in tax and extra fees won't matter at all so what part is scam

27. McLTE

Posts: 922; Member since: Oct 18, 2011

This whole thing is a scam! I believe part of the argument for why the big US carriers charged more money was because of the device subsidies. Now that they are removing these subsidies, Verizon is obviously reducing operating costs by a significant amount. So... where are our lower rates based on this new model? There aren't any lower rates. Verizon is merely defining another way to F the customer. At least T-Mo has/had a plan where if you bring your own device or buy one at full retail, you'd get a cheaper plan. You KNOW Verizon will charge the same rates and now make you pay full retail for the phone. And.. yes I realize that right now it looks like a way to buy phones early, but this is definitely going to be the model going forward.

33. Rockbottom97

Posts: 27; Member since: Jan 08, 2013

The device installment plan is a way for those customers that want to buy newer devices every year afford them. EVERY carrier wants to get away from subsidies. Companies like US Cellular have huge debts for device loans right now because of all the subsidizing they have done and then losing customers that they can not afford to pay on those loans. They are currently pulling out of Illinois (Chicago Market) and retreating into Wisconsin. T-Mo might be onto something, but the greater American public is so used to not paying for there phones that subsidizing devices will always be a part of wireless culture for a bit.

53. kaintae

Posts: 98; Member since: Dec 14, 2011

Yes, wireless costs for the consumer, are going up. But that doesn't make this pricing model a scam. It's optional. So if a customer is getting "f'd," it's by choice. Additionally, there's a reason tmobile has to drop prices. If all things were equal, they would have no competitive advantage over their competition. Their network is absolute trash.

20. kaintae

Posts: 98; Member since: Dec 14, 2011

You could get the phone and immediately cancel. But there is still the activation/upgrade fee when you initially purchase the device. I think this really only benefits the guys who have the unlimited data and don't want to extend their contract and lose that plan feature.

29. Whateverman

Posts: 3295; Member since: May 17, 2009

And that's where the other shoe is going to drop. VZW has no respect for the term "Grandfathered", so I can see them just eliminating unlimited all together very soon. Just lost my new Every Two credit on the 15th, and unlimited data is the only perk left.

34. Rockbottom97

Posts: 27; Member since: Jan 08, 2013

There is only so much LTE spectrum to go around. (It's why you hear alot of info about Verizon's spectrum buys) If Sprint & T.Mo had the install base ATT and Verizon have they would not be able to support unlimited data. Verizon can't take away your Unlimited cause you signed a contract thats binding. If they wanted to take it away, they would have done so a long time ago. Verizon and ATT both hate unlimited data and its the only leg TMo and Sprint have left to stand on.

46. Whateverman

Posts: 3295; Member since: May 17, 2009

True, but it's not like the unlimited users are all streaming Netflix 24/7. If an unlimited customer and a shared data customer both use 3GB of data in the same month, it cost VZW the exact same amount. The only difference is how much profit can be made, and lets face it... The shared data customer is the cash cow depending on his/her plan. Verizon took away unlimited data to make room for new customers, I'm cool with that. I'm even cool with them charging a little bit more to "grandfather" unlimited customers. But what they've done is raise the price of every unlimited customers bill by a minimum $600 per year based on what device your willing to buy out right. And thats just one more reason why VZW sucks.

44. trexnkrumpets

Posts: 45; Member since: Jan 15, 2013

Tmobile isn't allowing ANYONE to remain grandfathered in if you want a new device. Even if you signed up the day before the new changes took affect. Just so you know.

47. Whateverman

Posts: 3295; Member since: May 17, 2009

That is unfortunate, but it still doesn't compare to the crap VZW does to it's customers. Tmobile is looking so good right now, I don't even think I'll wait for my contract to end. And it works fantastic in the areas I need it for. Win, win!

6. papss unregistered

Wait... What? Just so I'm clear, there is no more 2 year contract?

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