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Wonder if this will lead to people preferring lower priced SKU's once they better understand the full cost of the Phone they are using.

by dman 11y ago

nlawalker 11y ago
I think many people will not only start to look harder at lower-priced phones, but they will consider going longer between upgrades, and become more interested in second-hand phones. The biggest thing going on here, in my opinion, is that there is now a decoupling between "device" and "plan" in the consumer's mind where there was previously a very strong coupling. Savvy users have been able to buy a phone somewhere besides an AT&T store for a long time, but up until now it's never been a normal/default choice compared to going into an AT&T store, buying a phone there and signing a bunch of stuff that involves contracts and plan changes and fees. The default expectation now is that I should be able to plug a SIM into a phone and start using it without having to consult anyone, make account changes, pay fees or other BS.
- smackfu 11y ago
  Yeah, my brother and sister-in-law are saving up for a new house. When their phones reached the end of their Next plan after two years, it was effortless to just keep using them at a now reduced cost, instead of shelling out $30/month more each just to get the shiny new phone.
mkozlows 11y ago
Evidence suggests not -- they still finance it, and the difference between $27/month (for a $650 phone) and $18/month (for a $450 phone) is one that most people would wave off.
smackfu 11y ago
The biggest difference is that it makes sub-$450 phones much more of an option. When every phone contract included a $450 subsidy, it didn't make any sense to get a cheaper phone. You don't get cheaper than free. Now you can buy a basic smartphone for $100, and a pretty good one for $200. (IMO, cheap smartphones make the most sense if you can get on someone's family plan. It only costs us $15 plus tax per month to add another smartphone to our plan, which is within the means of everyone in our family, especially if they buy a budget phone.)

Wonder if this will lead to people preferring lower priced SKU's once they better understand the full cost of the Phone they are using.

by dman 11y ago

Wonder if this will lead to people preferring lower priced SKU's once they better understand the full cost of the Phone they are using.

nlawalker 11y ago

I think many people will not only start to look harder at lower-priced phones, but they will consider going longer between upgrades, and become more interested in second-hand phones. The biggest thing going on here, in my opinion, is that there is now a decoupling between "device" and "plan" in the consumer's mind where there was previously a very strong coupling. Savvy users have been able to buy a phone somewhere besides an AT&T store for a long time, but up until now it's never been a normal/default choice compared to going into an AT&T store, buying a phone there and signing a bunch of stuff that involves contracts and plan changes and fees. The default expectation now is that I should be able to plug a SIM into a phone and start using it without having to consult anyone, make account changes, pay fees or other BS.

smackfu 11y ago
Yeah, my brother and sister-in-law are saving up for a new house. When their phones reached the end of their Next plan after two years, it was effortless to just keep using them at a now reduced cost, instead of shelling out $30/month more each just to get the shiny new phone.

mkozlows 11y ago

Evidence suggests not -- they still finance it, and the difference between $27/month (for a $650 phone) and $18/month (for a $450 phone) is one that most people would wave off.

smackfu 11y ago

The biggest difference is that it makes sub-$450 phones much more of an option. When every phone contract included a $450 subsidy, it didn't make any sense to get a cheaper phone. You don't get cheaper than free. Now you can buy a basic smartphone for $100, and a pretty good one for $200. (IMO, cheap smartphones make the most sense if you can get on someone's family plan. It only costs us $15 plus tax per month to add another smartphone to our plan, which is within the means of everyone in our family, especially if they buy a budget phone.)