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Google Defends Nexus One Termination Fee

4 points by fiaz 17y ago

nkassis 17y ago
I don't get why t-mobile and google both have to charge. What is the logic behind two early termination fees?
wmf 17y ago
The article doesn't mention that $179 upfront plus $550 in termination fees would add up to $729 -- for a phone that only costs $530 unlocked. Rather than shaking up the industry, Google's hybrid business model for the Nexus One is turning out to be worse than the traditional "the phone company owns you" system. That's quite an achievement.
- pasbesoin 17y ago
  Did not yet read the article. But responding to your comment, on the other hand one might say that Google is encouraging the consumer to think through the subsidized phone purchase model and perhaps nudging them to purchase outright (if/when one thinks it through). If you don't like the product/service, the phone is unlocked. Sell it used, recouping hopefully a significant fraction of your investment, and move on. I don't know whether this is practical nor corresponding to their intent, but it comes to mind. I'm also unfamiliar with the ease and thoroughness involved in a user wiping their phone of user data before resale. EDIT: Read the article. They claim the Google $350 charge only applies when service is canceled within the first 120 days. Depending on the monthly fee, one would be better off just waiting out that period (ignoring the impact of possible unsatisfactory phone service during that time)? There is also an initial 14 day trial period. I don't mean to be overly favorable towards Google. In particular, some of the support woes that have been surfacing are in line with my past experiences with them. If you aren't high profile, seeking support can be talking to a wall. Also, The overall fees involved do seem excessive. The T-Mobile plust Google fees during the first 120 days seem like a double dip.
  - wmf 17y ago
    ...Google is encouraging the consumer to think through the subsidized phone purchase model... No, because Google doesn't document these fees in an understandable way. It's the same old "it looks cheaper but it's actually more expensive" business model, but now it's much more expensive.
    - pasbesoin 17y ago
      Fair enough (meaning your comment). I'm not familiar with their documentation in this regard, but it wouldn't surprise me.
arantius 17y ago
> That means anyone who buys the phone online with a T-Mobile contract and wants to get out within 3 months are ... ... fools who aren't responsible enough to sign a contract in the first place, and just getting what comes to them. Either way, it's cheaper to buy the unlocked phone. https://www.google.com/phone/choose?locale=en_US&s7e= https://www.google.com/phone/choose?locale=en_US&s7e= Subsidized phone: $179 Subsidized service: $80 * 24 months (click "more") Total: $2099 https://www.google.com/phone/choose?locale=en_US&s7e= https://www.google.com/phone/choose?locale=en_US&s7e= Unlocked phone: $529 http://www.t-mobile.com/shop/plans/cell-phone-plans-detail.aspx?tp=tb1&rateplan=Even-More-Plus-500-Talk-Text-Web http://www.t-mobile.com/shop/plans/cell-phone-plans-detail.a... No-contract plan: $50 * 24 Total: $1729 If you're stupid enough to sign up for a contract that costs more than the no-obligation version, and then you want to welsh on that contract: you've got to pay the penalties.

4 points by fiaz 17y ago

I don't get why t-mobile and google both have to charge. What is the logic behind two early termination fees?

wmf 17y ago

The article doesn't mention that $179 upfront plus $550 in termination fees would add up to $729 -- for a phone that only costs $530 unlocked. Rather than shaking up the industry, Google's hybrid business model for the Nexus One is turning out to be worse than the traditional "the phone company owns you" system. That's quite an achievement.

pasbesoin 17y ago
Did not yet read the article. But responding to your comment, on the other hand one might say that Google is encouraging the consumer to think through the subsidized phone purchase model and perhaps nudging them to purchase outright (if/when one thinks it through). If you don't like the product/service, the phone is unlocked. Sell it used, recouping hopefully a significant fraction of your investment, and move on. I don't know whether this is practical nor corresponding to their intent, but it comes to mind. I'm also unfamiliar with the ease and thoroughness involved in a user wiping their phone of user data before resale. EDIT: Read the article. They claim the Google $350 charge only applies when service is canceled within the first 120 days. Depending on the monthly fee, one would be better off just waiting out that period (ignoring the impact of possible unsatisfactory phone service during that time)? There is also an initial 14 day trial period. I don't mean to be overly favorable towards Google. In particular, some of the support woes that have been surfacing are in line with my past experiences with them. If you aren't high profile, seeking support can be talking to a wall. Also, The overall fees involved do seem excessive. The T-Mobile plust Google fees during the first 120 days seem like a double dip.
- wmf 17y ago
  ...Google is encouraging the consumer to think through the subsidized phone purchase model... No, because Google doesn't document these fees in an understandable way. It's the same old "it looks cheaper but it's actually more expensive" business model, but now it's much more expensive.
  - pasbesoin 17y ago
    Fair enough (meaning your comment). I'm not familiar with their documentation in this regard, but it wouldn't surprise me.

arantius 17y ago

> That means anyone who buys the phone online with a T-Mobile contract and wants to get out within 3 months are ... ... fools who aren't responsible enough to sign a contract in the first place, and just getting what comes to them. Either way, it's cheaper to buy the unlocked phone. https://www.google.com/phone/choose?locale=en_US&s7e= https://www.google.com/phone/choose?locale=en_US&s7e= Subsidized phone: $179 Subsidized service: $80 * 24 months (click "more") Total: $2099 https://www.google.com/phone/choose?locale=en_US&s7e= https://www.google.com/phone/choose?locale=en_US&s7e= Unlocked phone: $529 http://www.t-mobile.com/shop/plans/cell-phone-plans-detail.aspx?tp=tb1&rateplan=Even-More-Plus-500-Talk-Text-Web http://www.t-mobile.com/shop/plans/cell-phone-plans-detail.a... No-contract plan: $50 * 24 Total: $1729 If you're stupid enough to sign up for a contract that costs more than the no-obligation version, and then you want to welsh on that contract: you've got to pay the penalties.