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As phones become[1] no longer subsidized by network operators in the United States, this will become a non-issue. [1] EDIT: I changed the former word "are" to
by tokenadult 14y ago
As phones become[1] no longer subsidized by network operators in the United States, this will become a non-issue.
[1] EDIT: I changed the former word "are" to "become" for clarity. What I mean, as some readers picked up and some did not, is that I expect United States mobile phone networks to get out of the business of selling mobile handsets at a heavily subsidized price (as is current practice in the United States), and thus get out of the business of needing to lock in contracts to gain revenue to cover the up-front cost of the subsidy. When handsets are sold at near full list price, the networks can charge just their network costs to customers who are free to shop with unlocked phones. The United States market is confusing in having different technical standards for basic voice phone service on different networks, but the networks are converging on similar technical standards for their data networks, so eventually most smart phone users will be able to shop for networks here.
- endianswap 14y agoIs there some sort of legal nuance I'm missing here? Phones are surely still subsidized by Verizon, AT&T, etc.. Are you saying that those entities aren't network operators?
- w1ntermute 14y agoWhy do you think this is going to change any time soon? AFAICT, it's not going to.
- dmbass 14y agoT-Mobile is already dropping subsidized phones. See http://www.reuters.com/article/2012/12/07/us-tmobileusa-iphone-idUSBRE8B604A20121207 http://www.reuters.com/article/2012/12/07/us-tmobileusa-ipho...
- halviti 14y agoThat's interesting because I see AT&T doing the opposite. i.e. if you want a Nokia Lumia 920, they'll sell you one without a contract, but it's still locked. I called them and told them I'd like to use it when traveling, and they told me that since I had been a customer with them for so long they'd help me out. They later came back and told me they wouldn't be able to unlock the phone for me until the middle of May.
- pragmatic 14y agoDo you mean as time goes on, we'll have more unsubsidized phones like the Nexus 4?
- mikecane 14y agoLikely yes. China wants in here and what better way than to offer cheaper phones that you can use with any carrier? To fend off that competition, the big name brands will have to do it first. I keep asking how much of a carrier-free phone's "price" is actually too fat a margin built in to soak carriers, who can seemingly afford to pay up.
- eli 14y agoThat only works if the carriers do indeed offer a lower price for not taking the subsidy. AFAIK, T-Mobile is currently the only one to do that explicitly (I guess you could go PAYGO on other carriers, but it's not quite the same). If you have to pay the same every month whether you take the subsidy or not, then you'd be a sucker to not take it.
- mikecane 14y ago>>>If you have to pay the same every month whether you take the subsidy or not, then you'd be a sucker to not take it. Yes. But I think rates will change too. I think everything will sink to PAYG-like levels in the next few years. Maybe Sprint, being desperate, will change the industry.
- gst 14y agoSo if this happens. Why not just buy unlocked phones directly then, instead of buying them from the provider?
- jiggy2011 14y agoI guess for the same reason that people buy cars on credit. Here in the UK there are millions of students and people of limited means who own iphone5s but probably wouldn't have had the spare £550 in their bank account at a discreet point in time to buy one straight up.